The Diamond Pro

Engagement Ring Financing: Everything You Need to Know

By Michael Fried
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Bottom Line Recommendation:

We suggest not financing an engagement ring if at all possible. Usually, when you’re at the point of proposing, you’re also at a stage of life with other large financial hits coming your way: a wedding, preparing for a family or buying a house.

If you decide to finance your engagement ring, choose James Allen or Blue Nile financing. These jewelers offer the best deal (while many other jewelers will rip you off). Blue Nile and James Allen are reputable diamond dealers who deliver high-quality jewelry at an excellent price.

How to Finance an Engagement Ring

Financing an engagement ring allows you to purchase a ring that costs more than the cash you have on hand. When you finance, you agree to a payment plan or contract with the loaning entity. Promotional periods, interest rates and monthly payments are agreed upon upfront.

Four main options are available when it comes to financing an engagement ring:

1.  Finance Through a Jewelry Store

Almost every major jeweler offers a financing option. They usually promote interest-free financing for a certain period, such as 6 or 12 months.

It’s easy to be tempted by financing “deals” offered by well-known brick and mortar stores like Jared the Galleria of Jewelry, Kay Jewelers, Shane Co. and Zales. But their financing “deals” often come with a catch. If you don’t pay off the full amount within the promotional period, you’re subject to high interest rates and paying up to 50% more for the ring than its original cost.

As you can read in our reviews, we strongly suggest not purchasing from these jewelers. To see all of our candid reviews of jewelry companies, visit our Diamond Pro Reviews page.

If you do wish to finance through a jeweler, we recommend Blue Nile or James Allen. If you don’t qualify for financing with these two jewelers, the only companies you’re qualifying with are the ones ripping you off.

Blue Nile offers a credit card financing option with three choices:

  • No interest if paid in full within the promotional time period
  • Equal payments and 9.99% APR if paid in full within the promotional period
  • No special terms (with a 25 day grace period if the full balance is paid each month)

James Allen offers special financing to help you purchase the ring of your dreams. You have two choices:

  • Deferred interest if paid in full within the promotional time period
  • 9.90% APR with 24 monthly payments

A jeweler will run a credit report when you apply for financing, so choose your vendor first to avoid multiple inquiries hitting your credit report.

2. Finance Through a Personal Loan

Instead of financing through a jeweler, you can apply for a personal loan. A personal loan gives you the cash you need up front with the ability to pay the amount back over a period of time.

Personal loans come in two varieties: secured and unsecured. Secured loans require a collateral, like a car or a boat, in case you aren’t able to pay back the loan. Unsecured loans don’t require any collateral, but they will look at your financial history and credit.

Many personal loan companies will make their offerings seem great, but they usually charge initiation fees and high interest rates. We suggest steering clear of using personal loans for an engagement ring purchase if at all possible.

3. Finance Through a Credit Card

Like many other large purchases, like new furniture or appliances, engagement rings can be financed through a credit card. While some credit cards are better than others, you’ll often be subject to paying more for your ring due to interest rates.

If you do decide on a credit card for your engagement ring financing, look for a card that offers zero interest (at least for a promotional period). If you’re not able to find a credit card with zero interest, opt for one with a strong rewards program. You can get cash back or reward points toward things like travel and groceries.

Though we don’t recommend using credit cards to pay for your ring, make sure you can at least make the minimum monthly payments. Otherwise, you’ll be paying for your ring for many years into your marriage.

4. Alternative Financing

If you need assistance in purchasing an engagement ring but don’t want to go with one of the formal routes, consider these alternative options:

  • Borrow cash from a friend or family member
  • Work a side job to save up extra cash
  • Withdraw from your retirement savings
  • Sell belongings you no longer need
  • Scale back on your monthly spending

Receiving financial help for your engagement ring shouldn’t put you at a large disadvantage. If you don’t have enough cash for the type of ring you have in mind, consider lowering your budget or waiting a few months until you’ve saved up money.

Should You Finance an Engagement Ring?

In most cases, when you’re at the point of proposing, you’re at a stage of life with other large financial hits coming: a wedding, buying a house or preparing for a family. There ways to get your dream ring without breaking the bank.

That’s why we don’t advocate financing an engagement ring. Heading into married life together is easier and less stressful without additional debt added to the mix.

If you do need to finance a ring, consider our recommendations below on where to do it. Not all financing options are created equal, so be sure to find the best solution. Start your marriage with the least amount of debt possible.

Jewelry Stores That Finance

Here are some jewelry stores that offer payment plans or finance for engagement rings, and what they offer:

  • James Allen

    • Deferred interest if you pay in full within a 6-month promotional period (minimum $1,000 purchase).
    • 9.90% APR on 24 monthly payments (minimum $2,000 purchase, account must be in “good standing”).
    • 29.99% APR for accounts that do not qualify for the above rate.
  • Blue Nile

    • No interest if paid in full within the promotional period (6 months for purchases $500 – $1,499, 12 months for $1,500 and up, 18 months for Astor by Blue Nile purchases $2,000 and up).
    • 9.99% APR if paid in full in 24, 36, 48 or 60 months (depending on purchase price). Standard variable Purchase APR of 29.99% if not paid in time.
    • No special terms with a 25 day grace period for new purchases.
  • Brian Gavin Diamonds

    • 10-30% APR (based on your credit).
    • Monthly payment options of 3, 6, 12, 18, 24 or 36 months.
  • Tiffany & Co

    • 7.99% APR for a 24 month promotional period (8-21%, depending on your state, after this period if the total amount is not paid in full or if you make a late payment).
    • No interest for a 12 month promotional period (same rules as above if not paid in full).

Consider that the best financing option may not always be the best place to buy a ring. A store may offer attractive financing, but the actual diamonds they sell may be poor quality and overpriced.

Also important to note is that most financing plans become significantly more expensive if you don’t pay off the total amount within the promotional period. Stores may offer 6-12 months interest-free, which sounds fantastic. Until you’re hit with very high interest rates, from the time of purchase, if any balance remains after this time – even just $1.

If you go with financing that has a promotional period like this, be confident that you can pay off the entire amount within the interest-free period. Otherwise, you will end up paying a lot more than the actual price of your ring.

Best Place to Finance Engagement Ring

If you decide to finance your engagement ring, the best places to choose are Blue Nile and James Allen. Both are trustworthy and reliable jewelry vendors, so you can be comfortable you’re getting a high-quality piece of jewelry at an acceptable price.

Blue Nile offers credit card financing with three options to choose from, while James Allen offers special financing with two different choices. The financing offered by each company is reasonable, as long as you don’t overspend your budget.

If you don’t qualify for the financing through Blue Nile and James Allen, the only jewelers you’ll qualify for are going to be ripping you off. For example, we don’t recommend applying for financing through Jared or Zales. Read all of our reviews of the major jewelers to learn more.

While many of these vendors seem like they’re offering you a great deal, you’ll end up paying far more for your engagement ring than you should. At the end of the day, a quality vendor is more important than one with attractive financing options.

How to Buy an Engagement RIng With Bad Credit

Financing can be tricky if your credit score isn’t up to par. Many of the best and most attractive credit plans will require you to have credit in very good standing. If not, the plan will revert to something a lot less attractive.

Don’t forget, if something seems too good to be true – it is. This is particularly true in finance.

Here are some options to buy an engagement ring if you have bad credit:

Save Up and Pay Cash

This is by far the best option to buy an engagement ring if you have bad or no credit. Many lenders will invite you with the opportunity of financing on bad credit, but they’ll almost always come with exorbitantly high interest rates, that you’ll be paying for well into your marriage.

That’s why it’s a smarter option to bite the bullet and save up until you have the amount needed to buy your ring in cash.

You may need to make sacrifices in order to do this, but it will work out a lot better in the long run than taking out a predatory loan. These sacrifices may be money (giving up some luxuries like eating out while you save up) or time (working a little extra, such as a side job, or waiting a little longer to get married).

Lower Your Budget

If you have bad credit and little cash up front, you may have to be realistic about your budget. You probably can’t afford an expensive, lavish ring, but that doesn’t have to be your only choice. By shopping smart and going through reputable vendors, it’s possible to find a beautiful, meaningful ring that won’t cost the earth.

Financing Through a Jewelry Store

Jewelry stores will do a credit check too, so if your credit is really bad, this still may not work for you. However, many are a little more lenient in offering credit, compared to other credit card issuers. You may be able to qualify for a store credit card such as Blue Nile’s – just be careful to read the terms on your deal, and pay your balance within the promotional period.

Credit Cards with No Down Payment

Many credit cards can be opened with no down payment and an introductory period with 0% interest. While financing on a credit card is not a great idea, due to the interest rates accrued on a large purchase like an engagement ring, if you’re certain you can pay the amount off within the promotional period, this can be a decent solution.

Buy Second-Hand

If your finances are not in a good situation, it’s not going to help if you run out and spend a ton on an expensive ring. It will be best for you and your fiance to keep costs down and buy second-hand instead of splashing on a new ring. Discuss this with your fiance to see if this is right for the both of you.

Best Financing Options for Engagement Rings

What is really the best way to finance an engagement ring?

Ideally, you should save up enough to pay for the ring up front. Any time you finance a purchase as big as an engagement ring, it’s risky. Many people before you have wound up paying for the ring well into their marriage, due to finance plans that add a ton of interest on top of the purchase (which is already expensive). All it may take is to delay the purchase a little while you save up.

If you do need help financing an engagement ring, the finance options offered by James Allen and Blue Nile are the best. Both offer 6-12 months deferred interest, allowing you to pay nothing extra on top of the purchase price. As a bonus, these are the most reputable online jewelry vendors, so you can be confident you’re getting a good deal on the ring itself.

If you go down this route, ensure you are not borrowing an amount of money outside your means. You should know that you will be able to pay off the entire amount within the promotional period. Otherwise, you’ll end up with interest charged back to the purchase date, and a big bill on your hands.

How to Determine How Much to Spend on an Engagement Ring

Building a budget for your engagement ring can be tricky. You may have heard that you should put two months’ salary toward an engagement ring purchase. But this spending “rule” was constructed by marketers and jewelers in order to get buyers to spend more on rings.

Instead, your budget should be based on your unique financial situation and the desires of your fiancé (check out our tips on what to consider when choosing a ring). For help in setting your budget, read our article on how much to spend on an engagement ring.

Determining the Style of Ring She Wants

Gather information about what type of ring she desires (i.e. the setting, style, a diamond vs. a gemstone) to help you in your search for the perfect engagement ring. Follow our expert tips in this guide to determine the type of ring that will make her dreams a reality.

Final Thoughts on Financing an Engagement Ring

Overall, we encourage against financing an engagement ring if at all possible. Going with Blue Nile or James Allen financing will give you the best choice, though, if you decide to go with financing.

If you want to discuss shopping for an engagement ring, email our experts.

About the author
Mike learned the diamond business from the ground-up at Leo Schachter Diamonds - one of the world's top diamond manufacturers. He has been recognized as a diamond industry expert by Time, PeopleMoney, The Daily Mirror, NerdWallet, The Times Herald, Yahoo Finance Australia, The Art of Charm, The Washington Diplomat, The Next Web, and more. See more
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