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Your Taboo Money Perspectives

A while ago now I was listening to a chat with a woman in the finance industry who made a very valid (and perhaps controversial?) point about the cost of weddings... She said: “Someone else’s decision to get married should not be your financial burden”. Why? Because more often than not, getting married puts the couple in a more secure financial position, by combining their finances.

It has stuck with me ever since.

With the rise of social media, wedding culture seems to become more extravagant each year. People put so much pressure on themselves to keep up or have a point of difference on their big day, and whilst this definitely adds to the cost for the hosts, there are often also inadvertent costs that fall on the guests.

You want to get married in Italy? Your guests need to fly there. You decide on a black tie dress code? Your guests will need to buy accordingly. You have a wishing well where you can see exactly how much someone has contributed to a gift? Your guests will feel pressured to contribute more to avoid looking or feeling stingy.

So (perhaps selfishly), as we approach the age of wedding seasons, we want to start the conversation and give people the language that they need to feel more comfortable and confident to talk to their friends about what they can, and can’t afford, when it comes to their decision to tie the knot.

Have you suffered financially because of wedding season?

If you answered yes to this, you are definitely not alone. We surveyed our community and of those who consider themselves in “wedding season”, 83% reported you’re struggling to keep up.

If so many of us are feeling this, why aren’t we doing anything about it?! Well, weddings are a really hard topic…

Most of the people you love most in your life will likely get married one day, and their wedding will hopefully be one of the best days of their life. And of course, you want to be by their side for that, celebrating and supporting them. Seeing them happy makes you happy.

But the financial burden is real…

We asked the YIGC community, how much you typically spend attending one wedding. We were blown away!!! The highest figure reported was $8,000. Yes, that’s right - 1.5x the average monthly pay cheque in Australia, to attend a single wedding. I had to know how the $8k was accumulated, so I reached out to our community member for the details…

This community member hit on something that kept coming up in your stories: the price you pay for not being in a relationship. Enter “the singles tax”.

According to the Australian Bureau of Statistics, in 2019, a single-person household could spend $2,835 per month on living costs, which was 27% higher than couples, who had an average dual spend of $4,118 per month. This difference is expected to have grown in the current cost of living crisis.

A recent eye-opening conversation with a friend illustrated this perfectly. My friend is in their 40s, happily single. For the sake of the story, let’s call her Jane. Jane has attended a lot of weddings in her time (and also mentioned a lot of baby showers!!). Throughout the years, Jane has spent thousands of dollars on presents, outfits, accommodation, flights, and everything in between. Jane shared a particularly memorable story of when she was the bridesmaid to a bride who wanted to stay in a hotel 30 minutes from where Jane lived the night before and night of the wedding. Unable to afford the extra money, Jane pulled her friend aside to let her know that she’d stay at home to avoid footing the pricey bill on her own (unlike the other bridesmaids that would be splitting the cost with their partners). She reflected that this conversation nearly ended the friendship. Now 40, single and beyond happy, she feels like she will never technically “make back” the money she has spent on everyone else.

Others reported spending in the range of $1k to $7k on friends’ weddings, with the most common costs being:

• Flights

• Accommodation

• Hens and bucks parties (which many of you noted as being the most expensive part)

• “Just being a bridesmaid”

• Outfits

• Recovery party

And of course the present… NATURALLY, we wanted to know how much our community usually spends on a wedding gift.

The most common answer was $150. A lot of you answered $100 when you don’t know the bride or groom as well, whilst the upper end ranged between $300-$500 for best friends.

The most common rhetoric (which is definitely what my mum has told me!) is that you “pay for your plate”, i.e. how ever much it cost the bride and groom to host you… So good luck to us with the way weddings are going!

We will end our wedding on our favourite comment on gifts…

Touché ;)

Has society warped your expectation of the future home you can afford?

Story time: the other day, I went to an inspection in North Bondi, Sydney. The apartment next to ours has gone up for sale, so of course I had to have a sticky beak. This apartment would be classified (in my eyes) as one and a half bedrooms as the ‘second bedroom’ would only just fit a double bed and legit nothing else - not even a chest of drawers. But of course, it is advertised as a two bedder. The place has no balcony and faces into another block of apartments. But, and a big but, the place is in a prime location in Bondi. So I asked the agent (pretending to be an adult that could afford an apartment in Bondi), what’s the asking price?

$1.5m…

Now, I know that is a sh*t tonne of money and I can’t begin to imagine that number of 0’s in my bank account. But by the same token, deep down I had probably anticipated that to buy a place in an inner city suburb, I’d be forking out a million plus. I must admit, the old “million bucks” is starting to feel quite normalised these days.

So I decided to start digging into how much $1.5m really is. I turned to my trusty Up Home Calculator. As I slowly dragged ]the slider up to $1.5m, I quickly realised just how out of reach the apartment would be.

1. I do not earn $200k, and neither does the majority of the Australian population (so who is affording this small cramped apartment!?!?)

2. I couldn’t make a $7.3k monthly repayment even if I tried (feet pics & all)

So, why do I think that when I go to buy my first home that it’ll be in the $1m + category?

Welcome back, our old friend the comparison trap. I thought I could afford something for that amount because I see people on social media doing it. But what’s not pictured? The years of sacrifice. All I see is their smiling IG upload in front of a “sold” sign.

Safe to say, we are both very early days when it comes to our home buying stories. And so we are very excited to welcome our first ever contributor to this newsletter!

Nicole Haddow is the author of Smashed Avocado, The Ethical Investor, and Couple Goals, and shares her reflections on the desire of buying a dream home vs the reality of what we can actually afford…

Nicole suggests there are a few things to consider if you want to buy a home:

• A home can cost far more than the mortgage. Consider how a purchase will impact your lifestyle and long-term goals 

• If your first home is a stepping stone to something better, think about the appeal for a future buyer or renter down the track

• Considering an apartment? Understand the additional costs such as strata fees and building maintenance 

• Speak with professionals such as mortgage brokers, financial planners and tax agents to understand the full implications of buying and selling 

• Finally, don't let FOMO drive your decision-making. A dream home is one you can secure when you’re ready. It’s ok if it takes time to make your dream a reality 

Sounds like pretty sage advice to us! As an avid reader of Nicole’s books myself, I can confidently say that her experience and advice are both relatable and inspiring (if not entertaining!). A massive thank you to Nicole for sharing your expertise… Nicole Haddow’s latest book Couple Goals is out now. 

Speaking of Couple Goals, keep an eye out for tomorrow’s episode with the lovely Chantelle Otten, where we talk all things money and relationships.

Until next week,
Mads and Soph x