Wedding loans – what finance options are available?

Weddings can be as big or small as you want them to be – you might opt for a lavish celebration with your extended family and friends or an intimate backyard get-together with those closest to you, or you might even decide to elope and keep it to the two of you.

Whether you want a few fairy lights in a tree and some chairs from the local hire place, or a formal sit-down dinner with a drinks package and venue hire, there will be costs involved in your wedding, and these costs can be significant.

When it comes to paying for your big day, personal loans for weddings can be one option, but before borrowing money, it’s important to understand exactly how these loans work, and consider your options so you don’t start married life with a hefty debt hanging over your heads.

What is the cost of a wedding in Australia?

According to Easy Weddings, the average couple in Australia spends about $35,315 on their big day, and interestingly, this amount tends to be more than the couples initially planned to spend. Easy Weddings surveyed 4,000 engaged and recently married couples found that, on average, they shelled out around 29% more than intended, a not insignificant extra expense.

The fact that costs blowouts are so common means that, whatever you think you’ll end up spending on a wedding, you’ll likely spend more. You may fall in love with an expensive outfit, or clock the late-night slider buffet at a friend’s wedding and decide that you really want on of those too, and all these things will affect your budget.

Whatever the reason, it can be worthwhile to budget extra for a wedding as unexpected expenses crop up.

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What expenses typically contribute to a wedding?

Depending on the type of day you wish to have, common things you may have to pay for include:

• venue hire for the reception
• the ceremony, including celebrant and possible separate venue hire
• marquee, table and chair hire
• a food and drinks package (catering)
• professional photography
• entertainment, such as a band or DJ
• wedding rings
• clothing such as dresses and suits
• hair and makeup
• transport to and from the venue
• accommodation
• flowers and decorations
• cake
• hens/bucks parties
• marriage licence
• invitations and postage (if you are sending them by the post)
• gifts (e.g. wedding favours and presents for the bridal party)
• dry cleaning
• honeymoon

What are personal loans for weddings?

There is no specific product known as a wedding loan – rather, this is a loan that you might take out to use for the purpose of spending on your big day.

A personal loan is an amount of money that you can borrow for a specific purpose, and it can either be secured or unsecured. When you take out a secured personal loan, an asset you own, such as a car, will be used as security for the loan, meaning the lender will have the right to sell that asset should you be unable to meet your repayments. When you take out an unsecured loan, there is no asset used as security.

Lenders typically consider secured loans to be less risky, meaning that the amount you can potentially borrow may be higher, and the interest rate on the loan may be lower. If you are looking to borrow money to fund a wedding, a personal loan may be an option, but as with any loan, there are risks attached.

What other wedding loans can you get and how do they work?

If you plan on borrowing funds to cover some or all of the expenses related to your wedding, there are a number of potential options available besides personal loans – these can include a line or credit or even a credit card.

Lines of credit

A line of credit is a kind of loan that comes with a flexible repayment schedule. Typically with a line of credit, you will arrange with your lender to have funds available to withdraw up to a set limit, and you have the option to draw up to this limit, or use none of it at all.

A line of credit differs from a standard loan in that funds can be withdrawn and repaid at the discretion of the borrower, and there is no fixed repayment term. Likewise, you will typically only pay interest on the funds you have actually drawn.

Credit cards

If you already have access to a credit card with a competitive interest rate, you may also consider using this for purchases related to your wedding. If you are looking for ways to reduce your interest repayments on an existing credit card debt, one option may be to transfer your debt from one or more existing cards to a new card that offers 0% interest for a limited time.

Guarantor personal loans

If you don’t fit the criteria for a standard personal loan, you could also consider a guarantor personal loan, which essentially means that a trusted person such as a family member or close friend can agree to be responsible for your loan in the event you are unable to make your repayments. These kinds of loans are risky for a number of reasons, one of which is the potential to damage familial relationships or friendships if payment obligations cannot be met.

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How can you apply for a wedding loan?

Depending on the lender, you can apply for a personal loan in person, over the phone, or in some cases online. The lender will consider your financial circumstances, including your income, savings, assets and debts and credit score in order to get a picture of who you are as a borrower. This will determine the amount they are willing to lend you, and at what interest rate.

The process of applying for a wedding loan is similar to applying for any other loan, and Canstar has a guide on how to apply for a personal loan, along with some tips to help get you started and factors to keep in mind. You can also compare personal loans with Canstar to find one with low rates and appealing features for you.

What are the risks of wedding loans?

It is always worth keeping in mind that when you borrow money for any purpose, you will need to consider your budget and whether the loan is affordable for you, as you will be going into debt and will need to repay your lender, with interest. If the term of the loan is long and you have a high interest rate attached, the repayments you make may end up being significant. Some specific risks can include:

• Loss of assets or court proceedings: If you fall behind in your repayments with a secured loan, the lender will be entitled to sell the asset or assets you’ve used as collateral to reclaim their funds, whereas if you fall behind with an unsecured loan, the lender may take you to court in order to reclaim the funds owed.
• Negative impact on credit score: If you fall behind in your repayments, your credit score may be negatively affected too, making it harder to borrow money down the line to make a purchase like a car or house. You may then find that you have to put significant time and effort into rebuilding your damaged credit score.
• High interest repayments and fees: If you are considering a line of credit, it is worth keeping in mind that the interest rates attached to these can be high, and conditions can be strict, meaning if you don’t read the terms and conditions carefully, you can end up paying a great deal in additional fees and charges and impacting your credit score.
• Temptation to overspend: When borrowing money, especially on a credit card, there can be a temptation to overspend thanks to the mindset that paying it back is a ‘later problem’, but doing so can see you end up in a large amount of debt. Credit card interest can build up quickly if you don’t pay off your balance in full each month, meaning you’ll have more to pay off down the line.

Some wedding suppliers also work with buy now pay later (BNPL) providers, although BNPL can come with significant risks. A recent report from the Australian Securities and Investments Commission (ASIC) cited concerns that some lenders in this space enter into unsuitable contracts with financially vulnerable consumers.

Consumer Action Law Centre CEO Stephanie Tonkin cautions that “the amounts borrowed [from BNPL providers] can quickly spiral with late fees and charges.” She adds that “many BNPL users in hardship that we speak with still manage to keep their accounts open by skipping meals to prioritise repaying BNPL, so that they can access credit in future.”

It’s also worth noting that, from June 2025, BNPL lenders will be subject to new laws in order to boost protection for consumers.

Payday loans are also an option for people who don’t fit the criteria for standard personal loans, but the Financial Rights Legal Centre has explicitly warned Australians that these kinds of loans are not recommended, as they can lead to unmanageable debt and damage your credit score.

What are some alternatives to wedding loans?

Rather than take out a loan for a wedding, many couples choose to save up to fund their big day. There are a number of advantages to this approach – using savings to fund your wedding could mean avoiding debt and accumulating interest, and it may help encourage you to set a realistic budget, and not be tempted to spend money you do not have.

If you and your partner are planning a wedding in a few years time, one approach might be to start setting money aside in a savings account, where it will grow interest until you are ready to draw on it for your big day. If you are considering starting a savings account for this purpose, Canstar has a guide to the best savings account interest rates on our database.

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