Know how to plan for your child's wedding


Despite many changes in Indian society, till now, the marriage of child/children is the responsibility of Indian parents. Wedding is a costly affair. How can the parents prepare themselves to fulfil this responsibility? Read this article to know.

India has been changing. The inherent values of Indian society have changed a lot during last fifty years. But even then, marriage of child/children is still considered the duty of the parents in every stratum of Indian society. All Indian parents think it is their responsibility to marry off their children.

Needless to state that in India, marriage is a very costly affair. Most of the time people spend beyond their capability in the marriage of their children due to societal pressure and various other reasons. So, it is imperative for all parents to save for the marriage of their children. This article tries to find ways for the guardians to get financially prepared for the marriage of their child/children.



Same old advice: Start early

All financial experts and experienced people give the same advice: Start saving and investing as early as possible, preferably immediately after starting earning. All parents must keep in mind the very important theory of compounding effect of investing. Very briefly, this theory proves that to reach a pre-determined corpus at an age of 55, a person who starts investing at an age of 25 (for example) has to save only half of the amount of investment of a person who starts investing (in the same investing instrument) at an age of 35, to reach the same corpus. So, young earners! Start your investment as soon as you start earning.

There is another advantage to the investors who start early. Those who start investing in their twenties can take more risk than those who start investing in their thirties. Those who start investing in their thirties can take marginally more risk than the forty-plus investors. And fifty-plus investors can't take any risk. We already know that those who take calculated and informed risk, get far better return in the long-term.

Stop being extravagant: Protect yourself with insurance

Only if you save more, you can invest more. So, make a monthly budget and try to stick to that budget. Drastically cut down unnecessary expenditure. Minimize watching movies in the multiplexes, cut down dining out in restaurants. Stop spending money on new vehicles and invest the surplus money. At the same time, protect yourself with term insurance and health/accident insurance. In case of any untoward happening, the insurance(s) would provide a protective umbrella to your child/children and other family members.

Invest wisely: Take calculated risk

Please remember that saving is not investing. Saving is only the first part of investing. Save money and then invest wisely. Don't put all the money in one basket. Divide the invested money into fixed-income instruments, equities and in gold. The early you start investing, the more you can invest in equities, which will, in turn, give a better return in the long run. But at the same time try to avoid direct equities if you are not fully conversant with the share market. Invest in equity mutual funds instead. Keep track of your investments in every quarter and take necessary corrective measures considering the performance of your investment instruments. When you reach near your goal, shift your investment in liquid mutual funds or other risk-free instruments.

Don't ignore the education of the child

Needless to state that education of child/children is the biggest investment. So, don't neglect the education of your child. Provide him/her the best educational opportunity which you can afford.



Don't compete with others: Spend rationally in the wedding

In India, people tend to compete with neighbours and relatives during the wedding of the child/children. Don't fall in this trap. Spend rationally according to your own pocket and saving. This would in turn give a proper lesson to your child and daughter-in-law/son-in-law. They would learn to cut their expenses according to their earnings.

Wedding loan as the last resort

Financial planners strongly discourage taking loan at the time of child's wedding. But there may be some situations when the guardians are forced to take loan for meeting the wedding cost. Under such circumstances, they must try to take wedding loan from bank/recognised financial institution. Not only that, they must bargain to try to reduce the rate of interest, or to get the best deal from the lending institution. But please remember that taking wedding loan must be the last resort.

Summing up

The wedding of child is a very happy occasion for the parents. The parents must plan well in advance so that this happy occasion doesn't cause unnecessary financial burden on them.


Article by Partha K.
“Those who will not reason, are bigots, those who cannot, are fools, and those who dare not, are slaves.” - George Gordon Byron

Follow Partha K. or read 274 articles authored by Partha K.

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Comments

Author: Natarajan10 Jun 2018 Member Level: Diamond   Points : 5

Traditionally, we, in India have grown with the concept that children's wedding is the most important duty of any parent, come what may. Yes, it is important but not mandatory that we need to take huge loans, spend money unnecessarily and give them everything they need.

We need to treat marriage as a task that needs to be approached practically with resources in hand and not get carried away too much. Glad that the author has mentioned saving early and focussing on education too. In India, many couples still spend more money on their child's wedding than they would have been willing to spend on their education.

In some families, parents take wedding as a challenge to prove what they have done in life so far. Instead of truly enjoying the happy occasion, they tend to outdo the recent weddings that have happened in the family circles.

Ornaments, grand receptions, processions, lavish food etc is okay if someone is wealthy but to do this with we really cannot afford is a big mistake some parents commit.

Saving money, investing it, buying a piece of land etc needs to be done early and it is wise to remember to really keep a check on the budget especially if there are other children to be married in due time.

Author: umesh10 Jun 2018 Member Level: Diamond   Points : 6

The author has given a good overview of how to plan and save for the wedding ceremony of the children. It is rightly said that savings for such grand occasions should be planned well ahead in advance.

I have some thinking related to the wedding of the children and I want to share the same here.

Those who are rich and can afford can plan the wedding of their children whatever way they want. There is absolutely no issue in that, but the problem being faced is by the middle class or poor people. They are unfortunately trapped in the ugly business of show off and many times under this compulsion spend more than their capacity and land in trouble.

So wedding part and the rituals are all right but the financial part is a bit worrisome as we are not bold enough to curtail the expenses or go for a simplistic marriage ceremony. This trend in society is not in a good taste and we must praise and appreciate those persons who advocate and go for simple marriages where expenses are contained within the budget and unnecessary indulgences are avoided.

It does not make sense to spend beyond one's capacity in a 2-3 days function of a wedding especially in show off of prohibitively costly garments, dresses, and exotic foods.

Some gullible people are impressed by the benchmarks of high expenditures by the wealthy ones and try to mimic the same shabbily without understanding that they should never go beyond their means.

Author: DR.N.V. Srinivasa Rao11 Jun 2018 Member Level: Diamond   Points : 4

A nice write up by the author with various necessities to be taken for the marriage of the children by the parents.
There are two aspects to this. The first one is that the parents feel that getting their wards married is their responsibility. But slowly there are some changes in the outlook. The children themselves making their roadmap for their life and they are making a decision of their marriage and the age at what they want to marry. It is a good development to some extent and they are deciding themselves on their partner also,
Coming to the expenditure part, the second aspect, parents should make a budget for the marriage based on their capacity and it is not advisable to go for a loan for the marriage expenditure unless otherwise, it is an absolute necessity. Here the parents should not get influenced by the other marriage celebrations. One should not go for unnecessary expenditure and false prestige.
Planning only the total expenditure is not sufficient. One should plan for individual expenses for each part of the celebrations and when we go for the purchases these amounts should be kept in mind. Otherwise, the expenditure will go more than the budget.



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