Weddings are expensive and extravagant affairs, especially in India. From taking care of guests to providing good catering, to clothes, accessories and decoration, it takes a lot of money to finance a wedding. You also need to book a venue, transportation, entertainment, etc., all of which add to the costs.
On the other hand, weddings mark a very joyous occasion for the couple, and are a great reason for friends and family to get together and have some fun. Therefore, while it may be possible to budget in certain areas like venue, decoration, clothes, etc. while preparing for a wedding, cutting costs on certain other areas like food, may not be possible. Moreover, the cost of weddings these days is at an all-time high, so no matter how much you budget, you will still need approximately Rs. 20 lakh for a moderately lavish wedding.
So, what do you do? Well, there are several steps you can take.
How To Finance A Wedding?
While considering how to finance your wedding, the first step you should probably take is to create a budget. Consider all of the things you will need for your dream wedding, the cost of everything, and create a budget accordingly.
Based on that information, you can look at the various financing options that you have. Ideally, you should save up for your wedding as soon as you start earning. Putting aside a certain amount every month from your salary, will give you a good amount to use, when the time actually comes. Additionally, parents can also start investing for their child’s wedding much earlier, allowing the power of compounding to build a nice corpus.
However, if you haven’t been able to save up, or have used the saved money for another emergency, you also have an option to avail a Personal Loan for weddings (also called a wedding loan). You can also pay for your wedding with a credit card, though weddings loans might be the better option of the two.
Why Wedding Loans Are A Good Way To Cover Weddings?
A wedding loan is essentially a Personal Loan that you use to pay for your wedding requirements. It can be used to cover every wedding-related cost, from purchasing wedding attire, to booking caterers and a venue.
Many banks and NBFCs offer such Personal Loans for weddings. These come with many great features and benefits, like a flexi loan facility, quick approval and disbursal, high loan amounts of up to Rs.25 lakh, minimum documentation, flexible repayment tenors, pre-approved offers, etc.
All this makes a wedding loan a quick and easy way to finance your wedding. However, be sure to shop around, and compare Personal Loan interest rates, before you choose a loan. Moreover, you should also check your eligibility for a Personal Loan, before you apply.
What You Should Consider Before Applying For A Wedding Loan
Apart from comparing wedding loan interest rates and eligibility, you need to understand that when you borrow money to finance your wedding, you are essentially paying money you do not have, for a successful wedding.
Borrowing the money also means that you have to repay it later. This could take you years, depending on you and your (to-be) spouse’s income. Therefore, be sure to consult your partner and consider both your finances thoroughly, before you decide to choose this option.
Additionally, since you’re opting for a Personal Loan for your wedding, it will be unsecured, meaning you will not have to provide collateral. However, not being required to provide collateral also means higher interest rates and a stricter approval process. That in turn also means that you need to have a good credit score and history to ease the approval.
You can work your way around this though, by choosing your lender carefully. Smaller banks and NBFCs usually have a more flexible approval process, than larger private banks. This means that you may get the loan even if you have a bad credit score. Additionally, applying to a bank/ NBFC that you already have a good relationship with may also ease approval.
Thus, opting for a wedding loan is a good idea to finance your dream wedding, but should only be done after very careful consideration.