January 28th 2022

How Much Should You Spend on An Engagement Ring?

By Devin Jones

How to determine your engagement ring budget using common sense and some age old rules.

How To Choose Your Engagement Ring Budget

A general rule of thumb, which is completely arbitrary, is that a man should pay between 1 and 3 months’ salary for the engagement ring. This idea was of course first introduced during a marketing campaign by one of the major diamond companies back in the early 1900’s and has stuck around for generations. So, maybe a good rule of thumb as a range but still not as important as considering your own situation and doing what’s right for you. It’s also important to have some discussion about these things with your significant other before popping the question – if you have a $3,000 ring in mind and they’re dead set on a $30,000 stone then you might have more to discuss than diamond hypotheticals.

Your budget should be constrained by your debt level, savings level, and your income. It is not recommended that you use debt to purchase a diamond, but many people do choose to finance their ring at least partially in some way. Cash is always the most advisable option and not just because you are saving yourself from the interest payments associated with financing. When credit card companies get in the middle of a transaction they charge the seller of the goods or services a fee which the seller would rather not pay. When it comes to a large purchase like a diamond, that small fee of between 1% and 3% actually matters as it could represent hundreds of dollars.

Most online jewelers will offer you a reduced price if you pay for a stone via wire transfer (a direct cash transfer from your bank to their bank) as opposed to credit card payment. Paying with cash could end up saving you a lot of money when you add up the discounted price and the interest payments on your credit card, so we advise paying for as much of the purchase as possible in cash.

Most guys save up for months before making the purchase and if you can set aside a portion of each paycheck it will certainly make things easier when you decide to make the big decision. However, some guys end up buying a ring in the spur of the moment for any number of reasons. If you are strapped for time you might need to use more financing or credit than someone who has had the time to save, and as long as you’re OK with that then you can pay it off in the coming months or years – just be careful not to overspend and rack up too much debt. Don't forget - the diamond is the first of many large purchases you'll be making the months and years ahead, so it's important to start things off on the right foot.