Marriage allows you to annoy one special person for the rest of your life. Jokes apart, marriage is a serious affair that you must be financially prepared for, lest you fall short of money at the last minute. Marriages can be expensive, especially, if you consider taking the traditional route.
One has to spend a minimum of ₹10 lakh, which may escalate depending on how fanciful your wedding ceremony is. The financial burden of weddings on parents can be tremendous, especially, when they have to pay for the expenses from their savings. While it is a common affair for parents to plan their wards’ wedding expenses, it would do a lot of good if today’s generation took interest in saving and investing for their marriage.
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The tendency to save for marriage is very low. You may attribute this tendency to the age-old custom of parents turning into wedding planners for their children. However, in not-so-financially affluent families, children are keen to start saving and investing from an early period, though most of their savings and investments are directed at buying a new house or planning for higher education in foreign lands.
If you are aware of how money works to create more money or have already chalked out your financial goals, it would do a lot of good to start saving and investing early for your marriage too. However, a lot depends on how soon you are looking to get married. This will help you contribute immensely toward your own marriage instead of relying on your parents solely to bear the expenses of your nuptials.
Planning to marry soon?
Marriage may not be on your cards immediately, but do you still intend to be married within the next five to six years? Fret not, as you can generate a lot of money for your marriage by regularly parking money in mutual funds. Since your financial goal is just five to six years away, taking too much risk or investing in funds subject to market volatility may not help.
Instead, go for balanced advantage funds that will shift your money between equity and debt depending on market conditions. You can opt for a conservative aggressive fund that parks money in debt and equity securities with a relatively lower risk. The idea is to have a plan in place and save toward your goal.
Since your tentative marriage is not too far off, it would not make sense to dabble in risky instruments, and hence, the choice of these less risky funds. Start early to gain from the magic of compounding.
|Name of the fund||Type of fund|
|10,000||HDFC Balanced Advantage Fund||Balanced Advantage Fund||12.84||5||2,44,273||8,44,273|
|10,000||Edelweiss Balanced Advantage Fund||Balanced Advantage Fund||12.12||5||2,27,602||8,27,602|
|10,000||Kotak Debt Hybrid Fund||Conservative Hybrid Fund||9.62||5||1,72,789||7,72,789|
|10,000||Canara Robeco Conservative Hybrid Fund||Conservative Hybrid Fund||8.81||5||1,56,002||7,56,002|
With just five years’ worth of investment, you can save enough money for a decent marriage ceremony. You can obviously arrange the remaining expenses from your savings and other investments. Alternatively, if you are looking to cumulate a higher corpus, you may invest in more than one hybrid fund, step up your investments every year, or give yourself a year or more before you get hitched.
If you already have had equity mutual fund investments in your name by your parents, take care to shift a part of the accumulated corpus to either conservative hybrid funds or debt funds to incur less risk on your earnings.
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Planning for delayed marriage?
Some people are just not in the mood to get hitched before they have earned and saved enough. This also includes investing enough to not only spend on your wedding but also have enough to take your spouse out on a holiday outing.
Take, for example, you do not want to be married before the next 10 years. With so much time at your disposal, you can surely save enough for your marriage. If you are not much inclined to take risks or are affected by frequent market volatility, you may choose large-cap funds. You may also invest some money in large-cap funds and the remaining in mid-cap or small-cap funds.
Assuming that you want to accumulate at least ₹40,00,000 for your marriage and post-marital expenses. Start with a small investment of ₹10,000 every month. Step up your investments by 10 per cent every year. Category returns in large-cap funds are more than 12 per cent.
For the sake of convenience, let us assume the returns rate at 12 per cent. Then, put ₹5,500 in small-cap funds. Step up your investments by 10 per cent every year. Category returns in large-cap funds are more than 15 per cent.
|Market cap of the fund|
Total corpus value
Against the much-needed corpus of ₹45,00,000, you are now able to accumulate more than ₹51,00,000, thus, leaving you with enough money to take care of unforeseen expenses.
Managing money is important before deciding to manage a family. Marriage is not all about celebration with great fanfare. It is about taking the first step to taking on a new responsibility. It is about accepting that you must plan your future in sync with your partner’s desires. Planning ahead for marriage, therefore, helps.