Best Engagement Ring Financing Options

You may be emotionally ready to propose to your partner, but what about financially? According to a 2021 study from The Knot, the average engagement ring costs $6,000 – which doesn’t even account for inflation and its impact on the price of many goods and services in the past year or so. If that’s not a cost you can pay out of pocket, you’re not alone. Fortunately, you can finance an engagement ring in a number of ways – hopefully allowing you to focus more on how you’ll ask the big question than how you’ll afford your purchase.

Let’s take a look at the best engagement ring financing options available so you can find the best one for your situation.

While the average price of an engagement ring according to The Knot study is $6,000, that doesn’t mean you’re required to necessarily spend that much. In fact, the same study found that one-third of buyers spent $1,000 – $4,000, with 8% paying under $1,000 for their ring. Again, though, these figures predate some of the inflation hikes that came about in 2022, so the numbers could be a bit higher.

An outdated rule of thumb suggests spending at least 3 months’ salary on an engagement ring. While most people have moved on from this standard, a ring is nonetheless an expensive and important purchase for most, and you should stay within a workable budget to avoid bringing your partner into an unstable financial situation.

No matter how you pay for the engagement ring, keep in mind that your proposal budget is personal, and you shouldn’t worry about spending a certain number of months’ salary on it. If you choose to go higher than, say, $1,000 on your ring, then it may be wise to consider your available financing options.

Here are some of the best engagement ring financing options to help cover the cost of this special piece of jewelry. Consider the pros and cons of each option and choose the right one for your situation.

1. Take Out A Personal Loan

A personal loan may be a viable engagement ring financing option if you have a strong credit score and want to pay off the purchase over several months or years. If you qualify for a personal loan, you’ll receive a lump-sum payment to finance the ring purchase, and then you’ll be required to repay the debt in monthly installments.

Before using a personal loan for an engagement ring, make sure the monthly cost of repaying the loan will fit your budget. As with other loan types, borrowing within your means is important. If you’re confident you can pay back the loan without a problem, don’t hesitate to apply for the loan as soon as you wish.

2. Use Jewelry Store Financing

Many jewelers offer in-store financing options, whether through partnering with a lender or offering a store credit card. These reimbursement plans can feature no- or low-interest payment periods for proposers who need extra time to pay off the engagement ring.

While a promotional period of this nature can help you save money in the short term, your interest rate will increase once the promotion ends if you have a remaining balance. Just to be safe, it’s important to know you can afford the regular interest rate on the ring purchase in the event you don’t pay the ring off during the promotional period.

Also, before signing on the dotted line, be sure to check for hidden fees or extra charges associated with the jeweler’s financing plan.

3. Open A Credit Card With 0% Introductory APR

Another way to buy an engagement ring with little to no interest is to use a 0% introductory credit card. However, it’s vital that you match the card’s promotional period to your proposal timeline so that you can pay off all or most of the ring cost before the regular interest rate kicks in. Similar to a financing plan from a jewelry store, the regular APR on the credit card will go into effect as soon as the card’s promotional period ends.

This payment method works best if you have a good credit score that qualifies you for a high credit limit. But regardless of your credit score status, you should work to pay off the engagement ring cost during the promotional period and avoid any interest payments.

4. Pay With A BNPL Loan

Buy now, pay later (BNPL) loans, also called “point-of-sale financing,” are becoming more popular through services like Affirm, Afterpay and Klarna. This one-time installment loan allows buyers to stretch their payment out over time in smaller increments.

BNPL companies don’t require full applications, only a soft credit check followed by immediate approval that provides greater accessibility for borrowers. Many services also offer 0% interest for borrowers who pay in full within a certain time period, similar to credit cards and in-store financing.

Be sure you’ve read and understood all the terms of your agreement before signing up, and ask about hidden fees.

5. Use Your Savings

Using your savings is usually the cheapest and most hassle-free option when paying for a ring – as is the case with any major purchase. That’s why it’s recommended that the proposer start saving for an engagement ring at least several months in advance.

When you pay for the engagement ring upfront, you don’t have to worry about potential late payment fees or possibly paying interest on the purchase. Plus, using your savings will prevent you from buying a ring that’s outside of your budget.

If you plan to tap into your savings to pay for the engagement ring, take a look at your financial status and goals before setting a maximum ring budget. Then, spend the weeks leading up to the purchase cutting back on nonessential spending and saving windfalls to meet your goal.

Engagement ring financing involves a little more than how to afford the ring. Take a look at these frequently asked questions and their answers.

What credit score do I need to finance jewelry?

Credit requirements can vary depending on the lender and financing sources. Most personal loan lenders and platforms require a minimum credit score of 610 – 640, but for good interest rates, you’ll want a score of 650 or higher. Many credit card issuers require a minimum score of 700.

What is a typical down payment for an engagement ring?

In-store financing on your chosen ring may require a down payment, the amount of which can differ among jewelers. Some stores require 20% or more down for their in-store financing offers.

There’s no down payment required for a personal loan or credit card.

Can I get engagement ring financing with bad credit?

Although it can be more difficult to secure funding for an engagement ring if you have a low credit score, you still have ways to cover the cost of the ring.

Some jewelry stores offer financing options specifically for people with a lower credit score, and these options can include promotions or sales to help lower the cost. Shop around to find local or national jewelers that offer deals – such as a no down payment option – that can help offset the ring’s price tag.

However, most no- or low-interest credit cards require a credit score of at least 700, so that payment method may not be a possibility for borrowers with a lower credit score. Take steps to improve your credit score so you can qualify for the best financing options.

Can I finance a wedding ring?

When you’re budgeting for an engagement ring, it’s a smart idea to plan for how you’ll pay for both you and your partner’s wedding rings. The average cost of a wedding band made from gold or platinum is $510 – $1,100. Rings made from tungsten metal are often priced closer to $200. Of course, any additional jewels will only increase your cost.

Although the cost of wedding bands is typically lower than the price of an engagement ring, you may still want to consider financing options for those purchases. Luckily, the same payment methods are available for both engagement rings and wedding bands.

However, since wedding bands are usually more affordable, many couples use their savings to pay for them so they can be sure to avoid interest or late payment fees.

Should I use a personal loan for an engagement ring?

Whether you should get a personal loan to purchase an engagement ring depends entirely on your financial situation. Using a personal loan comes with various perks, like no down payment, consistent monthly payments and no collateral, but you’ll encounter strict credit requirements and the potential for a high interest rate.

Review the pros and cons of personal loans to get a better sense of whether this financing method will work for you.

Marriage is a significant commitment, and paying for the engagement ring is, too. If you’re purchasing an engagement ring using in-store financing or a no-interest credit card, be prepared to pay down the ring as soon as possible to avoid high interest fees. Otherwise, consider alternative options like a personal loan or dipping into your savings.

If you’re leaning toward a personal loan for your engagement ring financing, you can start the application process today with Rocket Loans℠.