A friend of mine sent me the numbers for the cost of his wedding, and also included some other long term planning philosophies. I think it is a good example of how one can… have your cake and eat it too. I never said I had anything against big weddings (or other large expenses), just that people don’t think about these things rationally. This friend is clearly an exception. I’ve changed the names, but other than that this is all straight from his email. I’ll call him Edward:
“Our wedding cost $25,000.00 ($15K of which was for the reception – at one of the most affordable luxury venues in town).
We received $5000 as a gift from my parents, $5000 as a gift from my inlaws, $11,000 in cash from our amazing guests, and the balance of $4,000 Bella & I paid in straight up cash savings.
Don’t regret a thing…..and will be married to her until I take the long dirt nap. Coming from people who live a very frugal lifestyle, we didn’t have any regrets parting with our money on an occasion as significant as this.
Generally we like to save 30% of our gross earnings/annum (i.e. if Bella makes $70K/year, her objective would be to save $21K and that’s after all taxes and living expenses). We then invest these funds in real estate, real estate joint ventures or small businesses that yield no less than a 20% return on equity annually…..Also we don’t like to tie up more than 10% of our net worth in any one investment, nor do we let our cash flow/asset ratio drop below 1:9. We call is our 30-20-10 rule.
Love your blog. Hope all is well.”
In this case, the happy couple got a bit of help from family, but I suspect that even if they didn’t they would’ve had little trouble re-adjusting their plans. They are very disciplined.