Propose in style with the right ring — without saving up years in advance.
Our top pick: LendingClub Personal Loan
- No prepayment penalties
- Flexible loan terms
- Fast and easy application
Our top pick: LendingClub Personal Loan
- Min. Credit Score Required: 640
- Min. Loan Amount: $1,000
- Max. Loan Amount: $40,000
- APR: 6.95% to 35.89%
- Requirements: US citizen or permanent resident, verifiable bank account, steady source of income, ages 18+.
How does financing for an engagement ring work?
Financing an engagement ring works like financing anything else. You apply for a loan that covers the amount you’re seeking and, if approved, use those funds to purchase your ring. The complexity of the process depends on the lender you choose. If you go through a bank, you may have to wait a week or two before your funds are deposited into your account. Online lenders are faster, but often charge higher interest rates.
Once you have your loan, you can pay through card, check or cash. Then you start the payback process, which is usually done in fixed monthly payments for one to seven years.
What are my options to finance an engagement ring?
Sometimes your heart moves faster than your savings. If you don’t have cash on hand to pay for the ring of your partner’s dreams, options for borrowing include:
Jewelry store financing
Many big-name retailers offer in-house plans, with some extending no-interest financing. Just be wary of high interest once those promos revert and stiff penalties if you miss a payment.
Personal loan
A personal loan will likely be your best option because of the wide selection of lenders available. Loans through banks, credit unions and online lenders will be unsecured, and your rate will largely depend on your credit score and personal financial situation.
Credit card
If you can qualify for a credit card with a low- or no-interest period, you might find that you’re able to pay off your purchase before any intro APR expires. Just be cautious if you can’t — credit card revert rates are typically higher than personal loan rates, starting around 16% APR.
Friends and family
Deep down, we’re all romantics. Your loved ones may jump at the chance to help out. By asking for the most personal of loans, you could land flexible terms and rates as low as, well, no percent.
To avoid any complications or awkward conversations later on, carefully outline the terms of your agreement using a service like LoanWell. And make sure you understand any tax implications that come with borrowing from family.
Personal loans to help you pay for that rock
6 features to consider when comparing engagement ring loans
Before deciding on an engagement ring loan, compare the following features to ensure you’re getting the best deal available to you:
- Interest rate. Your loan’s interest rate significantly impacts the total cost of borrowing, so compare your options to find the lowest rate available to you.
- Fees. Fees add to the cost of a loan. Go through the loan contract to find out how much you might have to pay in application fees, loan disbursement fees, late payment fees and prepayment penalties.
- Loan amount. How much you can borrow differs between lenders. Generally, maximum loan amounts are between $25,000 and $40,000, though you should be able to find smaller loan amounts to cover more modest rings.
- Loan term. Getting a longer loan term can be tempting, as the monthly payments will be lower. However, the longer you take to pay off your engagement ring, the more you’ll pay in interest. Ideally, you should repay the loan as soon as possible.
- Eligibility criteria. Some providers require applicants to have good to excellent credit. While others may lend to people with less-than-perfect credit, be prepared to face higher interest rates.
- Unsecured vs. secured. Personal loans are generally unsecured, so you won’t risk losing your ring should you have trouble making repayments. However, there are some lenders that offer specialized loans and use your engagement loan as collateral. While these might come with lower rates, you risk losing your engagement ring should you default.
How much should I spend on an engagement ring?
The old adage holds that a wedding ring should cost three months’ salary, but that’s no longer a hard-and-fast rule. In fact, the typical American spent just two weeks’ pay on an engagement ring, according to 2019 data from The Upshot by Morning Consult. Most people spent between $500 and $3,000 — with the median payment hovering around $1,900.
But if your partner says yes, you aren’t done with ring shopping yet: You still need to get wedding bands. The average wedding band for women costs around $1,500. For men, that number is a much lower $550.
The cost largely depends on what type of metal you choose. White gold is generally less expensive than platinum. Some women also like to have their wedding band fitted with diamonds to match their engagement rings, which can easily make prices jump.
To figure out how much you can afford, consider:
- Your partner’s preferences. Your partner might have a specific style in mind and may prefer a less-expensive version of that than an extremely expensive ring in the wrong cut.
- Your financial situation. Before you buy an expensive ring on credit, account for other expenses that you’ll encounter going forward, including your eventual wedding plans. Review how a large purchase would affect your existing liabilities.
A personal loan could take your wedding from “meh” to memorable
What happens if they say “no”?
No one goes into a marriage proposal thinking their partner is going to say no, but unfortunately that doesn’t mean it doesn’t happen. So what should you do if you took out a loan to pay for the ring?
First things first, you should try to return the engagement ring to the retailer you purchased it from. Most brick-and-mortar jewelers — including Zales, Kay Jewelers and Tiffany’s — have a return policy, usually at least 30 days, for you to return an item for a complete refund. You’ll need to reach out to whatever store or online retailer you bought your engagement ring from to get the specific return policy.
If you took out a loan to purchase the ring, things get a little trickier. While many loan providers allow you to get out of a loan if the funds haven’t yet been disbursed, it’s usually not easy to get out of a loan if you’ve already received and used the money. In this case, look to see if your lender has prepayment fees. You can pay off the loan early, but you’ll still have to pay any interest that’s accrued or fees they charge.
What are the benefits and drawbacks of an engagement ring loan?
Pros
- Get the ring you want. If you don’t have money to pay for the engagement ring you want to buy, a loan can help you make the purchase now and pay it off over a few months.
- Quick and easy process. Getting an engagement ring loan is quick and easy. In some cases, you can get your hands on the approved funds by the following business day.
- Interest-free offers. If you choose to go the in-store financing route, you may be able to score an interest-free period.
Cons
- The burden of debt. If you borrow more than your means, repaying the loan can become a challenge.
- Monthly payments. Monthly payments may seem convenient at first, but you’ll be putting a few hundred dollars into a ring every month. If you’re planning your wedding, it could be better to put that money toward savings.
- High interest. Borrowers without good credit may face steep interest rates that can make a ring cost thousands of dollars more than its retail value.
Valentine’s Day proposals
If there were ever a day made for showing your boyfriend or girlfriend just how much you love them, Valentine’s Day would be it. And what better way to show your devotion to your partner than by buying an engagement ring and asking for their hand in marriage? That’s why February 14th is one of the most popular days for couples to get engaged.
According to a 2017 survey by James Allen, an online diamond and bridal jewelry retailer, 43% of millennials said Valentine’s Day was their top day to propose or be proposed to. What with the endless supply of long-stemmed red roses, chocolate candies and sales on diamonds, it’s no wonder that this love-filled holiday sees millions of couples getting engaged each year.
Fun fact: The holiday season is about more than just presents and eggnog: The most popular time of year to pop the question is between Thanksgiving and Valentine’s Day. More than half of engagements take place in December. The most popular day of the year to get engaged? That’s right: It’s Christmas Day.
Bottom line
Popping the question is a big decision with an even bigger price tag. If you’re ready to tie the knot but need help purchasing your ring, in-store financing or taking out a personal loan are just a few options to consider.
When you’re ready to propose, compare your personal loan options or other jewelry financing options to find the best offer.