Buying an Engagement Ring

by Dual Income No Kids on November 13, 2009 · 0 comments

By far, the most expensive and significant purchase I’ve ever made was the engagement ring that I bought for my wife. I had known for a while that I wanted to marry my wife Stacy, but I wanted to wait until the timing was right. That time came in the fall of 2007, when, after stashing away money bit by bit for a while, I decided to visit a couple jewelry stores and buy that ring. I already had the situation planned out; I was going to surprise her with a trip to New York City to see The Lion King on Broadway (something she had said she always wanted to see) and afterwards I was going to propose. That was the easy part. Buying the ring, however, was a much more complicated and nerve-wracking process.

I was willing to bend a few of my own personal finance rules in order to make this happen. Most responsible people will tell you to pay cash for the ring, but I knew what I wanted to get her and subsequently, knew that it was more than I had saved up. But I was hoping to pay for as much as I could in cash up front, and then finance the rest at a 0% interest rate. As I write this, I can feel the cringes from you readers. But stay with me. From shopping around and examining rings, I got an idea of the price ranges I could expect.

First, I spoke with a company that I previous had a credit card with about a 0% interest for 12 months promotion they were currently having. So I visited a couple of places “just looking”, until I found a couple places that had what I was looking for. I ended up with two places in mind, and after work one day (after making a lame excuse to my soon-to-be fiancée about having to head up to school for a meeting with my professor) I went to the first place to sit down with a “consultant” to set about picking a ring.

The consultant was nice, even if she was pushing me to rings that were way out of my price range. She wasn’t the first salesperson I had come across so I just kind of smiled and went back to the rings that I wanted. We started talking about financing and she mentioned an interest free plan, so I had her run my credit to see if I qualified. Unfortunately, I did not (barely a year’s worth of credit history played a role in that). The saleslady said that wasn’t a problem (for her at least) and she offered one of the worst pieces of financial advise I’ve ever heard. She asked if I paid my credit card off every month, and when I indicated that I did, she said that was my problem. She suggested I carry a balance from month to month to entice creditors to extend me credit. I told her that I’d keep that in mind, but no, I wouldn’t be buying that ring.

The second place I visited was a smaller place but I liked their merchandise so I talked to the sales staff there. Right away I was told that they didn’t get paid on commission and the gentleman spent a decent amount of time with me picking out the ring. It was a better quality ring that I had seen at the first place, and the price was so much better. It was low enough that I could pay for most of it with cash, and I signed up for the offer with the credit card company for 0% interest for 12 months (the one I mentioned above) to take care of the rest. Four months later the ring was paid off, without me having to pay any interest and I was all set to propose. Buying from this company turned out to be a great decision, as we’ve had to go to them for service a couple of times (resizing of both the wedding band and the engagement rings, as well getting a tiny diamond that fell off the band fixed, all free of charge) and they’ve been great. I couldn’t be happier with how it all turned out.

Buying the engagement ring taught me some great lessons that have stuck with me:

* Planning is key. I knew I wanted to propose long before I did, but taking my time in doing so helped in a number of areas. In particular it afforded me time to save my money, and although I wasn’t able to pay for the whole thing in cash, I was able to pay for a significant portion of it.

* Know how to differentiate between good and bad advice. Not paying off my credit card in full every month was not going to be a good way to “entice” creditors to set my interest rate at 0%. I still can’t believe she suggested that to me.

* Not all risks pay off. Relying on an interest free credit card to hold the balance until I could pay it off was quite a risk. It worked out in this instance, but it was never guaranteed. If it hadn’t worked out I would have been hurting trying to pay off that debt. Although I know people who play the interest-free credit card game, it’s a risky one if it doesn’t work out.

* Shopping around always helps. The more places I looked, the better idea I had about what price ranges to expect. That certainly helped me make an informed decision.

* Buying a big ticket item isn’t always just about the item itself. By getting her ring at the second place, I not only got a great ring, but a relationship with the jewelers that has been great, and has come in handy when we needed them.

* Controlling emotions is important. It’s hard to not get wrapped up in the process when buying an engagement ring. But I didn’t want us to start out lives together in debt (a theme that would pop up again when we were planning our wedding). Controlling my emotions allowed helped me make a smart choice.

Overall it was a potentially stressful experience that turned into a real positive. I’ve tried to take what I learned during that experience and apply it to other situations. I certainly learned a lot!

Michael

Twitter: @michael_dink

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