You’ve found the love of your life and it’s time to take your relationship to the next level. And that means one thing: buying an engagement ring for your forever partner.
At this point, there’s a lot of questions to answer, including how much money you should spend on the ring.
There is a widely cited “rule” that you should spend three months’ salary on an engagement ring. This stems from a 1930s De Beers advertising campaign that convinced men to spend roughly one month’s salary on this purchase.
By the 1980s, one month’s salary was no longer the rule. It turned into two months. And today, many believe that a minimum of three months’ salary is a good starting point.
But Is It True?
Before we go any further, remember this: an engagement ring is all about love and commitment. While money always comes into play, it’s the thought that matters.
Let’s start with a few examples based on the three months’ salary rule:
- Annual income: $30,000 – Cost of ring: $7,500
- Annual income: $60,000 – Cost of ring: $15,000
- Annual income: $120,000 – Cost of ring: $30,000
In Canada, the average cost of an engagement ring is $3,500.
For most people, that’s a far cry from three months’ salary. Think about it this way: $3,500 breaks down to a monthly salary of $1,166 or an annual income of roughly $14,000.
In other words, most people aren’t spending three months’ worth of salary on an engagement ring. In fact, with an average Canadian earning $54,630/year or $4,553/month, they aren’t even spending what they earn in one month.
Societal Pressure Can Weigh Heavy On Your Mind
Societal pressure is unrelenting. You see what your friends are paying for engagement rings. You see celebrities sporting rocks the size of a baseball. And of course, your online search turns up one “rule” after the next.
Additionally, internal pressure and stress have the ability to wear you out, cloud your judgment, and lead you down a dangerous financial path.
These tips can save you from caving to societal pressure:
- Don’t associate the cost of an engagement ring with love or affection: It’s easy to believe that spending more shows the other person how much you care. This isn’t true. It’s all about your love for each other.
- Don’t try to keep up with the Joneses: You don’t have to match the engagement ring that your best friend purchased for their partner. You don’t have to keep up with all those Instagram influencers who are showing off their sparkling diamonds. Do your thing and let them do theirs.
- Do your research: It’s a common misconception that you have to spend tens of thousands of dollars (or more) to purchase a high-quality engagement ring. Do your research to learn more about your options. For example, if you’re buying a diamond engagement ring, cut, colour, and clarity always come into play.
So, What’s the Answer?
Even with all this information, you may still be wondering if you should spend three months’ salary on an engagement ring.
Here’s the best answer we can provide: it depends!
If you’re on a tight budget and three months’ salary is out of the question, don’t push your financial limits.
Conversely, if you’re comfortable spending three months’ salary or more, it’s perfectly acceptable to do so.
You don’t have to adhere to any rule when buying an engagement ring. Do what’s best for you, your financial circumstances, and of course, that special someone in your life.
Whatever your budget may be, we’d love to help! Browse our inspiration gallery of engagement ring designs, view our latest creations on Instagram, and contact us to schedule a virtual or in-office consultation.
We look forward to meeting you!
Jonathan is the President & CEO of Kimberfire – a brilliant way to buy engagement rings, loose diamonds and fine diamond jewelry in Toronto, ON, Canada. You can find him on Twitter. Previously Jonathan worked in the Middle East, Belgium and Canada in various roles in the luxury goods sector including manufacturing, business development and diamond wholesale. Jonathan also spent a number of years as an investment banker with one of the large Canadian banks, where he focused on natural resources and diversified issuers.