You are probably here because you are planning to buy an engagement ring for your proposal but aren’t sure how much you should spend. In fact, you probably heard about the “2-3 month” salary rule or heard conflicting opinions from your friends about setting your budget.
In this write up, we will look at some of the engagement ring price rules that people always talk about. But are these “price rules” applicable to everyone in real life? Or should it be specific to your own situation?
I’ll also reveal tips to help you decide the amount of money you should spend and walk you through the entire thought process. So, let’s cut to the chase and jump right in…
Here is a list of topics we will be covering:
Before we talk about the common engagement ring price rules that are floating around in the industry, I want to show you some statistics to give you an idea of how much people are spending around the world.
|Country/Region||Average Engagement Ring Size||Average Cost (USD)|
|United States (US)||1.0 carat||$6,000|
|United Kingdom (UK)||0.6 carats||$2,600|
|Hong Kong||0.7 carats||$4,000|
In the United States, the average amount spent is roughly $6,000 but bear in mind that this number is skewed by a small percentage of people who buy very expensive rings. In fact, the majority of US shoppers spend between $3,000 to $5,000 and this can vary depending on where you live.
Now, I know it is human nature to make comparisons against other people. If the average amount is much higher than what you can afford, you shouldn’t feel pressure to match it or get into debt just to finance the purchase.
With that said, let’s take a look at two of the diamond engagement ring price rules that are used by people to set a budget…
I bought this cushion cut halo ring for my wife with a $3,000 budget.
When it comes to buying a diamond ring, the rule of thumb used in the industry is a 3 month’s salary guideline. This is the rule that most people are familiar with especially if you had done some browsing around or research.
Not coincidentally, this rule was started by a cartel called De Beers who had a monopoly in the diamond mining business. If you obey DeBeer’s rule for spending on a diamond ring, you would be expected to spend at least $15,000 on your ring if you make $5,000/mth.
And you can probably guess that there are flaws in following this price rule since they are established by a company with a vested interest to sell you their products.
This crazy rule dictates that you buy a diamond ring where the carat size is equivalent to the age of the woman. If the man is proposing to a 25 year old lady, he would be required to buy a 2.5ct diamond ring.
If you are a late bloomer or marrying an older woman, be prepared to break the bank. Marrying a 40 year old woman would require a 4.0ct diamond ring and that’s going to cost you a lot of money.
Realistically, how many people would be able to follow this engagement ring price rule? If you are fresh out of college and planning to get engaged, a 2ct diamond ring is going to be out of reach for most people.
The price of a diamond engagement ring is determined by 2 components: the ring setting and the center stone. If we go even deeper into a granular level, the cost of the diamond would be determined by factors such as the 4Cs and cutting style (shape).
In my opinion, the most important thing you need to is to figure out what your recipient wants and their expectations of an engagement ring.
Why? That’s because the engagement ring is symbolic of your love and commitment to your loved one and if possible, having a conversation would be very helpful. You could also try to get a family member or close friend to find out the information on your behalf.
If you can find out the shape of the diamond they like, the 4Cs of diamond they want, type of jewelry setting (white gold/platinum) and style of setting (halo, pave, solitaire) preferred, that can quickly help you establish how much the ring would roughly cost.
If this is the case, you should really sit down and have a candid conversation with the recipient about her expectations and what you can afford. Keeping the relationship in mind, it is important that you and your partner manage financial issues together in an open manner.
You could also start off the conversation by being honest that you cannot afford the ring of her dreams with your budget at the present time. Obviously, you want to work out something together and find a ring she likes to symbolize the relationship together or ask if a future ring upgrade would be possible when you are in a better financial position.
A simple yet beautiful solitaire ring setting like this only cost $350.
Now that you have a better idea to approach your diamond engagement ring purchase, it is easier to determine what works for you and what doesn’t. You may choose to abide by the “rules”, or not. But whatever you decide, here’s a few things we think are important to keep in mind.
#1: Start saving right away.
As soon as you know you want to propose, you need to begin putting away money and maybe even take up some extra work. The best way to start your life together is on a responsible foundation. I recommend at least six months before the actual proposal, or even sooner if you want to build up your savings.
#2: Don’t propose the second you think of it.
Yes, the temptation is strong to go out and buy the first ring you see, and go ask that special someone to spend the rest of their life with you. While this is a romantic and charming notion, taking some time to save some money and doing your research will help reduce the stress of engagement ring shopping.
This will also give your mind more time to settle into the idea of getting engaged and how different life will be going forward.
#3: Don’t be too cheap.
To be clear, I am not suggesting that you go out and spend a fortune or even a certain amount. This is coming from the angle of being thoughtful and thinking for the long term.
I’m sure you want to buy a diamond ring that’s durable and will last for a long time. Good quality jewelry does cost more because of better material and skilled labor involved in the fabrication process.
For people who are shopping on a tight budget, the last thing you want to do is to be blind-sided into buying the cheapest option you can find in the market.
As an insider in the industry, let me reveal that’s where the scumbags and unethical jewelers lie in wait to prey on unsuspecting consumers who only care about getting the lowest prices.
In conclusion, there are some “rules” or idealistic goals that some people adhere to when engagement ring shopping. However, you should bear in mind that the 3 months salary rule is created by the industry to make you spend more.
While the average amount spent on a diamond engagement ring is roughly $6,000, this doesn’t mean you need to spend $6,000 on your purchase. My advice is to look at these figures and statistics as a reference instead of them being the rules you need to follow.
You should look at your own personal financial situation and your recipient’s style preferences as a guide to help you make a buying decision.
Finally, take all the time you need to make a wise decision. You have already made a commitment in your heart to that one special person, and now it’s time to make it a reality with a proposal!