Planning to propose? We propose that you plan…

We all know that saving isn’t always easy but, with sufficient planning, it certainly is possible. Without taking the romance out of planning your proposal, the reality is that you do need to prepare for the cost of popping the question.

There are a number of factors which you may need to consider when planning this exciting event to ensure that you have the funds you need to make your perfect proposal, manage the expense of a ring and afford everything that may follow.

Consider these costs before you get the ‘Yes!’’

How much will it cost?

If there was ever a rule for how much you should spend on your engagement, that is no longer the case. This is your special occasion, you can spend as much or as little as you like. What is important is that you make it fun and memorable. Remember, after the proposal, there will be many other expenses - for example, the cost of a wedding and setting up your home together. Planning your costs and spending within your means for your engagement will help keep your future financial plans on track.

How much can you afford?

For some, the proposal including the cost of buying engagement rings may be one of biggest costs of coming together as a couple. For others, the wedding may be the primary cost. Regardless of which option you choose, a big display of spending should never replace what really matters - love! Sometimes the simplest gestures are the most romantic. With some careful thought and planning, you can create a romantic and magical proposal for a fraction of the cost. Consider what you can afford before you start to plan. And, if you plan to spend, only spend what you can afford.

If you already have existing savings that you can dip into for this very special occasion, that’s fantastic. However, do try to hold some back. Don’t make the mistake of spending every cent on your proposal.

If you do use some of your savings, be sure to continue building up your savings as soon as you can. The proposal is just one step towards your new life as a married couple. Excluding the obvious costs of the wedding, there will be many more moments in your life together that will need funding.

If you don’t have the funds now, remember it’s never too late to start saving. By planning ahead, you are giving yourself enough time to save the amount needed for your proposal. This will ensure you keep your ring purchase affordable and within your means, and can also help with identifying a key date for you to pop the question. Whether it’s Christmas, Valentine’s Day, a birthday or an anniversary, giving yourself enough time to plan and save for what you want will help you keep your savings on track.

To budget, the first step is to establish how much you can set aside from your income every month and then calculate the amount you can build up by the date you plan to propose. This is a good time to assess your spending habits using a budget planner and identify areas where you can make additional savings to help fund your proposal.

For tips on budget planning see "Plan ahead using 50:30:20 budgeting".

If you don’t want a big surprise proposal and have openly discussed this next step with your partner, then maybe sharing the cost is the way to go. It’s not uncommon for both parties to save and contribute to the cost of the engagement. This can also help if you want to increase the budget allocated for a ring. If you are ready to make the commitment of spending your lives together then you will most likely have discussed your marriage plans before now with your partner. This is not the time to be shy when discussing finances. Being upfront and open with your partner about your joint finances before you go up the aisle can help ensure that you have no surprises on the financial front after you tie the knot.

There is no doubt that the range of choice on engagement rings is incredible. Many of them are works of art. It’s easy to see how you could be mesmerised by some of the options available when looking for the perfect ring. However, it’s really important you have a firm idea of what you want and also, to ensure you spend within your financial means!

Some people may choose to save to buy their rings, others opt to borrow. If you choose to save, consider how long it will take you and build your goal into your budget. If you choose to borrow, you need to work out how much this will cost you in total, including any interest charged. To manage costs, saving is the better option but borrowing serves a purpose too and there is really no right or wrong approach. There are a few options when it comes to borrowing for your engagement.

Credit cards are a convenient form of payment for your engagement ring as they can provide great flexibility and financial freedom. However, it is important that you are in control of your credit card spending. Purchases on a credit card can incur interest if you do not pay it off within a specific number of days. These rates may be higher than a small personal loan. Therefore, you may want to check the available repayment options, in advance of making a big ticket purchase, to help decide whether you should purchase it on your credit card or if using savings or taking out a loan is more suitable. Make sure you are aware and understand the different features and benefits of your credit card, as well as the fees and charges.

While a credit card does offer the flexibility of making small repayments over time it may mean that you end up paying back far more than you initially spent on the ring. Before you make the purchase on a credit card, it is worth checking with your provider to see if you qualify for an interest-free period (sometimes offered to new card account holders) or if they offer instalment plans on large purchases.

An instalment plan is an alternative to getting a small loan where you can avail of a reduced interest rate for a purchase made through your card and make monthly repayments to clear this debt. Terms and conditions will apply.

If you are considering a loan for your engagement ring you should first check if the repayments fit into your monthly budget. You should aim to repay the loan as quickly as possible as this will reduce the overall interest charges you will pay. This will also get you back on track to save for your wedding.

Lending criteria, terms and conditions apply. Over 18s only and not suitable for students

To have, to hold and to insure

After a successful engagement and a “yes”, the engagement ring should be insured against loss, theft or damage. Most home insurance plans will allow you to add your engagement ring to your policy. Check the associated conditions which can include, for example, providing a valuation certificate. Check for any exclusions and limitations on the policy and get your ring covered as soon as you purchase it.

The 4 C’s

When shopping for a diamond, you’ll hear a lot about the 4C’s - carat, clarity, colour and cut. But we have an alternative 4C’s that may be of help too. Stick to the Cost you have budgeted for. Have Confidence that this will be the perfect proposal for you and your loved one. Communicate with your partner about how you will fund the next steps and Congratulations!