The Best Ways To Finance an Engagement Ring

What to do if paying cash is not an option for your brand-new sparkler.

Young couple taking a selfie at the beach with woman showing off engagement ring

Dean Mitchell / Getty Images 

Buying an engagement is no small purchase. In fact, it may be one of the biggest purchases you’ve made thus far in your life. According to The Knot's 2020 Jewelry and Engagement Study, the average national cost of an engagement ring is $5,500, with a quarter of respondents spending between $1,000 and $3,000. This price range means you may be considering financing an engagement ring.

First and foremost, paying cash is always the best option for major purchases like an engagement ring. Paying cash will save you money on interest, help you avoid late payment fees or penalties, and keep you from buying a ring that's out of your budget.

If paying cash for your engagement ring isn’t an option, you may be looking to finance that brand-new sparkler instead. We explore the best ways to finance an engagement ring, from jewelry store financing options to a personal loan, and even paying via credit card.

Jewelry Store Financing

Purchasing an engagement ring at a jewelry store has its perks. Your soon-to-be spouse can try on different rings and settings before you purchase it, to find the perfect fit. Your timing may coincide with a great sale, and the store may offer you a great financing option.

But before financing an engagement ring through your jewelry store, do your research. You’ll want to educate yourself on a few things:

  • Any promotional deals: You will likely be offered a low promotional interest rate. This promotion can potentially save you a lot of money, but be sure that you can afford to pay off the ring during that time frame.
  • Regular interest rate: Check the regular interest rate after the promotional period runs out. Make sure you can afford the payment at the regular APR on the off chance that you don’t pay it off during the promotional period.
  • Hidden fees or charges: With any big purchase, it’s smart to read the fine print and educate yourself on any hidden fees or charges included with financing options.


Watch out for “deferred interest” credit offers. Under those plans, if you fail to pay off the entire balance in the agreed-upon period—12 months, for example—you will be charged all of the interest you weren’t charged during the grace period.

You will also be expected to keep up with minimum monthly payments during the grace period. If you miss any payments—or are 60 or more days late on a payment—the grace period will end, and you will be charged for any interest deferred.

Credit Card

Another option to finance an engagement ring is to put it on a credit card, but that approach takes some planning. First, you’ll want to put the ring on a card with a very low APR—ideally 0%. You’ll also want that low APR to match the time frame within which you plan to pay off the ring. With that planning, you won’t get slapped with a high APR once the promotional period runs out.

To qualify for a low- or zero-APR card, you’ll need to have great credit. If you don't, then you may need to take some time to build up your credit score first. While you may be impatient to propose, taking your time and financing your ring the right way will save you a lot in the long run.

Personal Loan

When financing an engagement ring, taking out a personal loan should be your last resort. Ideally, you’ll want to secure a 0% financing deal with the jewelry store or put the ring on a low or 0% APR credit card. With those methods, you should pay the ring off before the promotional period expires. However, if you don’t qualify for either of those options—due to a poor credit score, poor financial history, or some other reason—a personal loan may be your best bet.

A few tips to consider: Shop around for a personal loan with a lower interest rate—under 10% is a good benchmark. Whatever rate you ultimately find, ensure that it’s lower than the average APR on a credit card, which is around 16%. While the average personal loan term is anywhere from 12 to 60 months, it’s wise to make the term as short as possible to save money on interest.

Can you afford to finance that special engagement ring? How about one that's a little less expensive? Use the calculator below to find out how much you'll pay monthly.

There's one last thing to keep in mind when financing an engagement ring: Be sure you’re purchasing a ring you can afford. Overextending yourself and financing a ring that you’ll be paying off 10 years down the road isn’t the most financially sound way to start a new marriage.

You still have the wedding and honeymoon to pay for, after all.

Frequently Asked Questions (FAQs)

What happens if an engagement ring is damaged during the period covered by the payment plan?

Whether or not you're still paying for the ring doesn't affect what happens when it's damaged—any debt you owe will still need to be repaid. However, you may be able to get your ring covered through renter's or homeowner's insurance. You can also purchase specialized insurance coverage just for the engagement ring.

How much should you spend on your engagement ring?

No one can tell you exactly how much to spend on an engagement ring, but you can look at national averages to get a sense of what others are doing. If the national average cost of an engagement ring is $5,500, and the national median average annual earnings are about $41,500, then you could say that most people spend about 13% of their annual salary on an engagement ring.

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The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. The Knot. "Here's How Much to Spend on an Engagement Ring."

  2. Consumer Financial Protection Bureau. "I Got a Credit Card Promising No Interest for a Purchase if I Pay in Full Within 12 Months. How Does This Work?"

  3. Federal Reserve. "Consumer Credit - G.19."

  4. Census Bureau. "Income and Poverty in the United States: 2020."

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