In Malaysia, weddings are celebrated with much joy and festivity, by all races and religions. Each ethnic group infuses its own unique cultural practices and religious elements into the celebration of marriage. Regardless of differences in ceremony and custom, every community views a wedding as a wonderful occasion to be enjoyed and celebrated not just by the happy couple but also by their proud parents, extended family, friends and well-wishers. However, the luxurious fabrics, gorgeous decorations, beautiful venues, lavish gifts and elaborate meals of the various cultural styles, all share one important thing in common…a gigantic PRICE TAG!🙂

Picture by SekociNorlie

Often, this less glamorous aspect of wedding planning is all but forgotten in the euphoria of the joyous occasion…but it usually will rear its not-so-pretty head, very soon. Yes, weddings can be expensive. Very, very expensive. Unless and until you have actually arranged and paid for a wedding, it is possible to underestimate just how expensive it can be, and just how many unexpected expenses can crop up. Many couples and their families have had unpleasant financial surprises while in the midst of preparing for weddings.

Pick up any bridal magazine, check out any online wedding planner, talk to any friend or family member who has been there, done that – and you will discover a dazzling array of details. Clothing, gifts, religious rituals, banquet dinners, functions pre and post wedding, honeymoon, flowers, decor, wedding cake, wedding giveaways, photography, videography… the list of options is endless and daunting. And so, it is really a good idea to spend a little time thinking about the financial aspect, and planning in advance.

It is very common in Malaysia for the parents of one or both parties to fully sponsor or partially sponsor a wedding. However, this cannot be said to apply across the board owing to differing financial backgrounds. Sometimes, for various reasons, the couple will end up financing the wedding on their own. In such a situation, deciding how to pay for the wedding would depend very much on how elaborate the wedding is going to be, and exactly when it is going to take place. The first thing to do therefore, is for the couple to decide what sort of wedding they want, and when they want it.

These two points should also be checked and confirmed with the various parents and stakeholders, to avoid misunderstandings and mismatches in expectations. Even if the couple is paying for their own wedding, the elders will still expect to be consulted on all material aspects.:) In terms of financing, this article looks at two possible scenarios, and how to deal with them. It also assumes that the couple is footing the bill 100%.

Scenario 1: A long engagement.

In this situation, a couple may announce their engagement or even their civil marriage at a registry on a given date, but may only plan to have the actual wedding ceremony, much later; even 1, 2 or 3 years later. Such couples are typically very young, possibly fresh graduates. In such circumstances, the couple has ample time to plan ahead and save for the wedding.

This couple is advised to set up a wedding fund, into which a reasonable sum could be contributed by both parties on an ongoing basis from their salaries and any additional cash they may have, to build up sufficient reserves. For higher returns, the couple could put funds earmarked for their wedding in FD, or look at placing funds in an investment vehicle such as a unit trust or REIT.

Obviously, proper due diligence would need to be done to select the right investment vehicle based on the couples’ desired return on investment and investment timeframe.

Scenario 2 : A short engagement

In this situation, the couple plans to marry very quickly after the engagement, perhaps in a few months’ time. This wedding was not planned far in advance; perhaps, the couple only just met recently; Cupid’s arrow struck across a crowded room, and it was love at first site leading to marriage. While such a chance meeting resulting in marriage is truly the stuff of fairy tales and romantic stories the world over, unfortunately, the downside is that there is less time to save money for the wedding. 🙂

Ideally, it would be best not to resort to taking out a personal loan from a financial institution to fund a wedding. Personal loans could attract a very high interest rate of between 6% and 24%. And while the temptation to swipe your credit card to take care of all the costs may be very strong, do not succumb. Credit cards are not a viable financing method as the interest they attract is simply way too high – in the region of 18% depending on the card.

Instead, maybe the couple could first assess what available funds they have. Are they able to at least partially fund the wedding from their own savings? Would it be possible to borrow a reasonable sum of money from parents, relatives or friends interest-free, and repay it after the wedding? Another option might be to scale down the size of the wedding to just immediate family and close friends, to keep escalating costs under control.

Hopefully, the above pointers will be helpful to you in planning your budget and savings plan around what should be one of the happiest days of your lives. To those of you planning your weddings soon, congratulations to you and wishing you all the very best! 🙂


KCLau
KCLau

Personal finance author and trainer

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