Parents often list a goal of wanting to contribute to their children’s weddings. And independently minded young couples often want their dream wedding without the “suggestions” from their well-meaning parents – thus they want to pay for their own wedding.

Weddings are costly and not an expense most people can easily absorb into their income for that year. That means they need to be save up for and most people get that. But how much does a wedding cost and how early do you need to start saving?

Earlier this year Bride to Be magazine released the results of their Cost of Love 2008 survey, which found the average cost of a wedding was $49,202.

That is only a couple of thousand dollars less than the average Australian wage before tax.

Since many couples probably earn less than the average wage they need to be saving one partner’s full wage for probably two years or more just to pay for their own wedding. That could be a tough ask especially if you are also saving a deposit to buy your marital home.

When you’re already dreaming start saving

Perhaps a better approach would be for ladies who dream of a lavish wedding to start saving right now, even if you are not yet in a committed relationship. When cupid strikes the wedding can creep up quicker than you can save.

Blokes Beware – Bling is Costly

Blokes should also be aware that the average cost of a bride’s engagement ring was $5,116. It seems the old notion of three months wage may be continuing. So if you are a traditionalist then get saving right now mate, ‘cos you don’t want to pay costly credit card interest on a depreciating asset like a ring.

Then of course you need to consider the wedding bands. They cost an average of $1,507 for the bride and $1,096 for the groom.

Remember that costs increase

One tip when you are establishing your savings plan is to factor in an increase in costs. One article about the survey results reported that the average wedding cost had risen 76 per cent in eight years. That equates to cost increases averaging 7.3% each year.

Save for your dream wedding

Your wedding and honeymoon are not the most important events in your life but they are one during which you get to be the centre of attention and one that will be remembered. So if you want to be able to do it as you dreamed it the ensure you have saved for it. Don’t make it any more expensive than it needs to be by borrowing money and paying interest.

Save for the significant events in life and you can have enough money for what you really want.

(I can’t find the official survey results on the magazine’s website but they were widely reported in newspapers including here and here.)

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Australian Scholarships Group (ASG) have just released an online calculator designed to help parents estimate the future costs of their children’s secondary school education. They claim it is based on extensive research of costs in addition to school fees. You can also select to calculate for different categories of school and differentiate based on your state of residence.

You may also be interested to read this more detailed research report from AMP & NATSEM, which examines the total cost of raising children. AMP & NATSEM Report – The Cost of Raising Children (Oct 2002) Note that the figures are based on values in 2002 and should be indexed for inflation.

(Please note that Australian Scholarships Group also offer education savings plan products – this post is NOT a recommendation for their product nor a recommendation for ‘education bond’ class of products . There are many different ways to save for your children’s education and you should explore them with your adviser.)

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One of the most common questions I am asked is “how much net wealth do I need to retire?” The answer to that question is very dependant on the lifestyle you plan to lead in retirement. If you are unsure how to define that lifestyle then one place to start is by looking at what current retirees spend in retirement.

Today, Westpac and ASFA (The Association of Superannuation Funds of Australia Ltd) released their latest Retirement Standard research. (Link to the research). The average retired Australian couple spends just under $50,000 per year in retirement to live a comfortable lifestyle. This assumes that they own their own home, and includes some travel but is certainly not a lavish lifestyle.

It is worth paying attention to such research of actual expenditure. Most clients I see guess they will spend lower than that amount. Yet when they actually describe their planned retirement lifestyle and then cost that lifestyle it is significantly higher than the “comfortable lifestyle” definition used in the research.

So whilst current retirees are living off that amount my guess is they do that partly by necessity and partly because they grew up in a different generation with different ambitions. Later generations appear to have much higher expectations. If that includes you then you will need to start planning early or be prepared to lower your lifestyle expectations.

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