Thinking of popping the question? Prepare for the expense of the engagement ring

Three years ago, my husband popped the big question on bended knee in front of the Christmas tree in the heart of the Toronto Christmas Market.

I said YES!

One house, a wedding, two kids, a global pandemic and a rock-solid financial plan later, we are happy . . . and a bit tired.

My engagement ring means the world to me because of what it represents: the next chapter in my life. I wear it all the time unless I’m swimming or sleeping.

Regardless of your life stage, if you want to propose to your love and are going to buy an engagement ring this season, follow these tips to keep your purchase on budget.

Forget the rules you’ve heard and determine your own budget

“Spend three months’ worth of your salary on the ring” is the most common spending guideline given to suitors. But that rule was invented by a diamond company! Talk about biased, right?

You’ll want to take your time selecting a ring that reflects your values, budget and what your honey wants.

Have you saved up for it? What can you afford to spend without incurring debt? If you have to take on debt, can you pay it off within 18 months and still meet your other financial obligations? How does the purchase impact other financial goals you might have, like buying a home? Has your honey given you specific ideas about what they like and don’t like, for example, a princess-cut diamond versus a classic band?

You’ve got to do what’s right for you and your financial situation. Keep in mind that during lean times, many couples don’t even buy an engagement ring. They just purchase a wedding band.

Research the types of rings available and the costs associated with your choices

You need to decide on the following: metal (gold, platinum, silver, etc.); stone (diamond, sapphire, etc.); and setting. Research how the cut, clarity, colour and carat impact the price of the ring. Be sure to investigate the jeweller and get referrals from trusted friends or family members. For example, do you want a custom ring or one that is ready to go? See if the jeweller has an exchange or return policy just in case. If you’re going the route of a diamond, I recommend that you understand where it comes from. Watch the movie “Blood Diamond” to understand what can happen when a diamond is not ethically sourced.

It can be helpful to have a trusted ally who can help you wade through the thousands of choices and considerations. Consider shopping with your partner so you can make the decision together.

Maximize your budget

Buy a ring that’s just less than the next carat size up. For example, buy a 0.75-carat stone rather than a one carat, or a 2.6 carat rather than a three carat. Compare the price of gold versus platinum or titanium at the time of purchase (global commodity prices change daily for precious metals). You could skip the diamond and go with a gemstone. If you’re serious about a purchase, negotiate the price by asking for a discount or presenting a competitive offer.

Second-hand market for the win

OK, so this one is a bit touchy, but hear me out. The pandemic was really hard on some couples, who are now separated or divorcing. This means a boatload of great rings are up for sale through the second-hand market. That is, eBay, Kijiji, Facebook Marketplace, pawn shops and so on. You should look at this option if you want to stretch your dollars as far as they can go. You can pay 50 or 60 per cent less for a second-hand ring.

Costs to consider after the purchase

You’ll want to factor in costs of cleaning and maintaining the ring after purchase. Sometimes you can save on these by purchasing a package upfront. And, depending on the home insurance policy you have, you may need to get additional insurance for your ring if its value is significantly more than your home policy would cover.

My best advice if you’re getting engaged is to plan ahead for the expense by saving in advance. This will ensure unnecessary debt doesn’t ruin your special moment.

This article was originally published in The Star. Lesley-Anne Scorgie is a Toronto-based personal finance columnist and a freelance contributing columnist for the Star.