Dave Ramsey says: There’s nothing wrong with an inexpensive starter ring
A listener of the Dave Ramsey Show is looking for advice on how much of his income he should spend on an engagement ring.
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Dear Dave,
I’m 24, and I would like to buy an engagement ring. I plan on asking my girlfriend to marry me within a month, and I was wondering how much I should spend on the ring.
I make $85,000 a year, and I have no debt. In terms of savings and retirement, I’ve got about $40,000 in a high-yield account, plus $10,000 in a 401(k).
Hayden
How to know how much to spend on an engagement ring
Dear Hayden,
That’s awesome! You’ve got a great start in life, too, based on the figures you gave me. Congratulations on all your success.
Now, let’s get down to the business of buying a ring. How much should you spend? Folks in the jewelry stores will tell you three months’ income. Don’t listen to them. One month’s income is plenty.
There’s nothing wrong with a less expensive ring when you two are just starting out. And more importantly, there’s no correlation between the size of the ring and the probability of the marriage being a success. High-quality marriages aren’t based on the size and price of the engagement ring.
The day I asked my wife to marry me, the diamond I put on her finger was just a speck. You practically had to squint to see it. We’ve upgraded that one substantially since, but we’re in much better shape financially. Now she’s got a headlight she can wear on her finger. That’s what you get when you’re willing to put up with me for 43 years.
Last thing, make sure you shop around before you buy. Learn a little bit about diamonds first. And don’t fall for the old line about diamonds being an “investment.” They’re not. Most diamonds, especially standard mined diamonds bought at retail, do not go up in value and often lose significant value as soon as you buy them.
Now, truly rare, high-quality, and natural fancy-colored diamonds can appreciate over time due to their high demand and limited supply. But that’s a different story.
Best of luck, Hayden. I hope the young lady in your life says yes, and I hope you have long, happy lives together!
— Dave
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Comments
1 Comments
Seriously Haydon, you only get married the first time once so buy a ring you're actually proud of.
If you have the uncontrollable need to be cheap, skimp on the honeymoon and book the room at the unimpressive General Kearny Inn Motel & Event Center in thriving downtown Kearney, AZ.
Seriously Hayden, you only get married the first time once, so go for it and buy the nicer ring.
If you're really that cheap, skimp on the honeymoon and stay at motel 6 in Gila Bend.
The dude is making $85k and Ramsey says one month's salary is sufficient - that's $7,000. That kind of coin will buy a pretty nice engagement ring. Just sayin'.