4 conversations to have before taking out a marriage loan

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Marriage loans are very popular, and for good reason. The average cost of a wedding is close to $ 34,000, according to research from The Ascent, and few people can afford to pay that full amount out of pocket.

The Covid-19 pandemic has had an impact on the size of wedding parties over the past year. But many people are optimistic about the possibility of hosting big events again as vaccination rates increase.

If you are considering taking a Personal loan or borrow to finance your wedding, it’s worth considering the consequences first. Here are four key conversations you should have with your fiancé before applying for a personal loan.

1. Is the loan really necessary?

When caught in the moment, it might seem like you need a lavish wedding, even if you have to borrow to get one. But the reality is that most of the major expenses associated with a wedding are often not necessary to have a good time.

If you can reduce your festivities enough to pay for your wedding savings, at least it’s worth thinking about. That way, you won’t start your life with debt to pay off. Take a close look at the numbers and discuss whether there are any adjustments that would allow you to avoid borrowing.

2. How long will it take to repay the loan?

When you take out a marriage loan, you incur future income to pay it off. It is important to know how long your money will be tied up to cover the costs of your wedding. So talk to your fiancé about this loan repayment schedule you will choose.

The shorter the repayment term of your marriage loan, the higher your monthly payments will be, but the less the loan will cost over time since you will not pay interest over a long period. Carefully consider the trade-offs between monthly payment amount, repayment time, and interest charges. Then you can find a solution that both of you are comfortable with.

3. How will we share the responsibility for reimbursement?

If you want combine your finances after marriage, the loan money will flow out of your joint accounts. But if you plan to keep things separate, you will need to figure out how to share the responsibility for paying your marriage loan. Make sure you are both on the same page.

If your fiance assumes that you will cover 100% of the cost because you are the one who wants the big wedding, but you plan to split the payments 50-50, it could cause a conflict. It’s best to avoid starting your married life with an argument over who is going to pay for the wedding party.

4. How will this affect our other financial goals?

Marriage is only the beginning of a life together. And there’s a good chance you have things to do as a couple, like traveling, buying a house, or starting a family. The financial commitment of a marriage loan could affect your ability or your chronology do these things.

Make sure you both understand the impact the wedding loan payments will have on your budget and your efforts to achieve other goals.

These conversations will help make sure that you both are comfortable with the way you finance your wedding. And you can assess all of what the loan will mean for your life together. That way, you can either borrow with both eyes open or decide to make a different choice.

Our selection of the best personal loans for 2021

We have surveyed the market to bring you our list of the best personal loan providers. Whether you’re looking to pay off debt faster by lowering your interest rate, or need extra cash to make a big purchase, these top choices can help you reach your financial goals. Click here for the full recap on our top picks.

We strongly believe in the Golden Rule, which is why the editorial opinions are our own and have not been previously reviewed, endorsed or endorsed by the advertisers included. The Ascent does not cover all the offers on the market. Editorial content for The Ascent is separate from editorial content for The Motley Fool and is created by a different team of analysts. The Motley Fool recommends Bitcoin. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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