The $3M Question: Dream Wedding or Dream Retirement?

With wedding season upon us—and with budgets for the big day continuing their upswing—Ann Hynek takes a look at what could happen if we applied some of those funds to a nest egg.

It’s mid-June and I can personally confirm that wedding season is in full swing. I attended a friend’s wedding a couple of weeks ago and two more are just around the corner. While millennials may, according to Urban Institute, be putting off marriage more than previous generations, wedding budgets continue to rise. A recent study found that the average wedding last year cost $31,213, and 45% of couples spent more than they budgeted.

While my aforementioned friends were quite financially resourceful—Steph stocked the bar with spirits purchased only on sale, and Shelby made all of her invitations by hand—I was reminded of something my dad told me shortly after he attended the wedding of a friend’s daughter. He came home and said, “If you elope, I will buy your first house.” I was 12 years old at the time and didn’t know what he meant. Today, I get it.

I don’t want to sound completely unromantic, but my dad’s seemingly cynical sentiment made me wonder: What would that $30,000 wedding fund look like if you invested it?

Crunching the numbers

Say we set aside $15,000 for the party and put $15,000 in a tax-deferred retirement account. We will then keep it invested for the next 50 years. If we assume an average annual total return for the S&P 500 of 9.7%, (based on data for the past five decades), we’d end up with $1.5 million at retirement. (Or, if we just hit City Hall and invested the entire $30,000, we’d have $3 million.)

Wedding Fund-invested

For illustrative purposes only.

While everyone, myself included, loves a good wedding, setting aside some of that cash to invest for the long haul is definitely something to consider. As for that house, Dad: I bet you didn’t think I’d end up living in New York City… Do we still have a deal?


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