Key learning points
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In-house financing, credit cards, personal loans, and point-of-sale financing are common ways to finance engagement rings.
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Features such as the setting, the material and the stone influence the cost of the ring.
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The average engagement ring costs less than $6,000, but can be more expensive if you opt for more luxurious options.
There are a number of ways to finance and make your engagement ring purchase more manageable, such as requesting a payment plan from a jeweler or taking out a personal loan. On any given day, a good quality ring can cost you a few thousand dollars – and buying an engagement ring in 2024 can be more challenging than usual.
A Bankrate survey found that while inflation has fallen, many economists don’t believe it will reach the Fed’s target until 2025. That said, having a budget that closely matches your situation is crucial when ring shopping.
Engagement ring financing statistics
- The average amount Americans spent on an engagement ring in 2023 was $5,500, according to figures The knot.
- The most popular price range for wedding rings ranges from $700 to $1,200, according to information from Brides.
- Americans spent approx $7,820 for their entire 2020 engagement. This includes the ring, photographer and both engagement and bridal parties.
- Diamonds are still the most popular stone when it comes to engagement rings 85% of all rings purchased in 2023.
- Lab-grown diamonds are a popular trend, especially because they can be 50 to 70 percent cheaper than natural diamonds.
- The average size of an engagement ring is one carat.
- Yellow gold engagement rings are becoming increasingly popular, with a 26% increase since 2015 – but white gold will still be the most popular in 2023.
Budgeting for engagement rings
You may have heard the old-fashioned rule of thumb that an engagement ring should be worth approximately three months salary. Diamond jeweler De Beers popularized the idea of linking the price of a ring to your monthly income in its marketing campaign in the 1930s. An engagement ring does not have to cost that much money, but you should still be prepared to spend at least a thousand euros on the purchase.
The Knot’s 2023 Jewelry & Engagement Study found that the average engagement ring price consumers paid was $5,500, up from $6,000 in 2023. Ring setting, metal type, and diamond or gemstone details (such as grade and size) all influence the price of your engagement. ring.
Due to the high cost, there are a number of options you can explore if you need to finance the purchase of your ring.
Financing jewelry stores
Many major jewelers offer in-house financing to help their customers pay for an engagement ring. These take the form of an installment loan: you make regular monthly payments toward the loan balance, plus interest.
In general, jewelry financing offers more flexible credit requirements compared to borrowing from a traditional bank. Terms vary by retailer, as do financing requirements, such as a minimum purchase amount.
Jewelry business financing is best for convenience
If you want a convenient source of financing and don’t have strong credit, you may want to consider in-store financing.
Credit card
Using a credit card to finance an engagement ring can be a strategic option for responsible borrowers.
Let’s say you have strong credit and qualify for a promotional 18-month 0 percent APR rewards credit card. If you can pay off your card before the promotional period ends, this could mean you pay no interest and earn rewards points or miles at the same time.
If your credit doesn’t qualify for a promotional rate, keep in mind that credit card interest rates may be high. If you use a credit card without an interest-free promotion, calculate whether you have enough budget to pay off the ring within the next billing cycle.
Credit card financing is best for strategic buyers
Individuals who have strong credit and can qualify for a period of low or no interest or who can repay the ring purchase on their next billing statement may be able to get a good deal with a credit card.
Personal loan
Just like jewelry financing, a personal loan is a type of installment loan. However, unlike financing at jewelry stores, since the lender is a third party, you must get approved for the loan before you start looking for your ideal ring.
Eligibility for an unsecured personal loan varies by lender, including credit requirements for approval. The benefit is that you compare rates from multiple lenders to find the lowest option, even if you have less-than-perfect credit. That said, if you want to get the best deal, make sure you improve your credit score by lowering high-interest debt, among other things, before signing up.
Personal loans are best for rate shopping
Buyers who have good credit and want to shop for a competitive interest rate may want to take advantage of a personal loan to finance their engagement ring.
Buy now, pay later loan
Buy now, pay later (BNPL) loans, also known as point-of-sale financing, have grown in popularity in recent years. BNPL services, such as Affirm, Klarna and Afterpay, are often integrated into the checkout process when purchasing an engagement ring online.
Normally you pay a percentage of the total costs in advance. You then pay equal amounts over a short period of time to repay the remaining balance. Depending on your chosen repayment term or your credit, you may be offered a BNPL loan without interest.
BNPL loans are best for online shoppers
If you’re shopping online and want a seamless financing experience with the option of paying no interest for a short repayment term, BNPL could be a good choice.
Frequently Asked Questions
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Applying for any type of financing can lower your credit score for a few months. However, you can look for lenders that offer prequalification to preview your rates without impacting your credit. Once you apply and undergo a hard credit check, you will see a small drop in your score.
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Wedding rings usually cost less than engagement rings. According to Brides, they start around $700 for the most popular varieties.
There is no perfect number when it comes to the price of a wedding ring. How much you should spend will be based on what you can comfortably afford without compromising other priorities, such as saving money for a house. -
The average American spends about $5,500 on their engagement ring. That’s an average: some people spend a lot more, and others spend a lot less. If you’re curious about how much you should spend, consider getting one engagement ring calculatoras this can give you a better idea of what is achievable.
