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The average engagement ring costs $5,900—what to know if you want to finance this big purchase

Select reviews how to plan ahead and finance an engagement ring — without breaking the bank.

Photo courtesy of LeVar and Reanne Harris
Select’s editorial team works independently to review financial products and write articles we think our readers will find useful. We may receive a commission when you click on links for products from our affiliate partners.

According to Wedding Wire, about 40% of all engagements happen between Thanksgiving and Valentine's Day, but romantics might argue that any day is a good day to declare your love for someone with a proposal of marriage. But it can also be an expensive day, depending on how much you spend on an engagement ring.

While most couples have moved on from the old rule that an engagement ring should cost three months' salary, it's still a fairly significant purchase for many people. A 2019 survey from The Knot found the average engagement ring costs $5,900, though 10% of survey respondents spent less than $1,000.

Like any big purchase, it's important to do your research before you buy. And if you plan ahead, there are steps you can take to make the whole process of buying a ring more affordable.

Here are five common ways to finance an engagement ring, from cash to credit to personal loans.

How to pay for an engagement ring

1. Save up your cash

Saving up your cash is a tried-and-true way to stay within budget, but it also takes time. Depending on your income and expenses, you'll need to start planning months, or even a couple years, in advance in order to save up enough cash for a sizeable purchase like an engagement ring. But don't confuse the lack of spontaneity with being unromantic — your partner will likely be thrilled once they learn about the thought you put into their surprise.

The first step is to research how much the ring is going to cost you. Then decide when you want to propose. If your ideal timeline is in 12 months, divide the total cost of the ring by 12 and set up automatic transfers from your checking account to a savings account every month for that amount.

If you want to spend $5,900, plan on putting aside $492 per month if you want to buy the ring in a year. (Don't forget the additional cost of sales tax, which could add an extra month or two to your timeline depending where you purchase the ring.)

To easily keep track of your ring saving, the Ally Online Savings Account lets you make up to 10 different "buckets" within the same account, each labeled for a unique purpose. Make a new bucket just for the ring — but be sure to give it a cryptic name if you share an account with your partner and you want to keep the engagement a surprise.

Ally Bank Online Savings Account

  • Annual Percentage Yield (APY)


  • Minimum balance


  • Monthly fee

    No monthly maintenance fee

  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle *The 6/statement cycle withdrawal limit is waived during the coronavirus outbreak under Regulation D

  • Excessive transactions fee

    $10 per transaction

  • Overdraft fees


  • Offer checking account?


  • Offer ATM card?

    Yes, if have an Ally checking account

See our methodology, terms apply.


  • Strong annual percentage yield on all balance tiers
  • No minimum balance
  • No monthly maintenance fee
  • Up to 6 free withdrawals or transfers per statement cycle*
  • Option to add a checking account
  • ATM access if you have a checking account


  • $10 fee per transaction if you make more than 6 in a statement cycle
  • $25 overdraft fee

2. Make extra cash

If you don't want to wait while you save up enough cash for the ring, take a lesson out of LeVar Harris' playbook. Harris knew he wanted to propose to his college sweetheart, Reanne Swafford-Harris, in 2014. But he was a little tight on cash because he had just bought his first house.

Harris, who worked as a private client banker at the time, didn't want to use a credit card to buy his fiance's ring because he saw so many colleagues and clients struggling with debt.

Instead, he followed the advice of one of his clients, who said: "I never buy the things I want, I buy assets that buy the things I want."

So Harris used his new asset (his house) to his advantage. He rented out the extra bedroom in his 2-bedroom, 1-bathroom home. His friends tried to discourage him, arguing he was too successful to be sharing his own space with roommates.

Within a year, Harris saved up $5,000 from his rental income. He paid for the engagement ring in cash, which came with a discount.

"I was able to negotiate $200 to $300 off of the ring because I paid in cash, and the jeweler didn't have to pay any processing fees," Harris tells CNBC Select. Now he and his wife now share similar cash-saving tips on their YouTube channel.

3. Use a credit card

Like most major retailers, jewelry stores may have a store credit card that you can apply for. Signing up for a store card might qualify you for a special interest period or an additional discount at checkout, but be sure to look out for deferred interest. If you sign up for a card that charges deferred interest, you could get hit with huge charges if you're unable to pay off your purchase during the introductory APR period.

Better than a store credit card is a 0% APR credit card that also has a sizeable welcome bonus. That way, you can pay over time without accruing interest charges, while also maximizing your savings by taking advantage of your large purchase to meet a minimum spend requirement.

With the Amex EveryDay® Credit Card, you could finance the engagement ring over 15 months interest-free (after, 12.99% to 23.99% variable) see rate and fees, plus earn 10,000 Membership Rewards® points after you make $1,000 in purchases in the first three months after opening the card. You could use those points toward travel (honeymoon, anyone) or as a statement credit to cover a future credit card balance.

Amex EveryDay® Credit Card

Information about the Amex EveryDay® Credit Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.
  • Rewards

    2X Membership Rewards® points at U.S. supermarkets on up to $6,000 per year in purchases (then 1X), 1X Membership Rewards® points per dollar spent on all other purchases

  • Welcome bonus

    Earn 10,000 Membership Rewards® points after you make $1,000 in purchases in your first 3 months

  • Annual fee


  • Intro APR

    0% for the first 15 months on purchases, N/A for balance transfers

  • Regular APR

    12.99% to 23.99% variable

  • Balance transfer fee


  • Foreign transaction fee


  • Credit needed


See rates and fees and our methodology, terms apply.


  • No annual fee
  • Competitive intro period on purchases
  • 20% extra point bonus when you make 20 or more purchases in a billing period


  • 2.7% foreign transaction fee

4. Apply point-of-sale financing

Point-of-sale financing has become increasingly popular, popping up when you checkout at more and more online retailers. It's basically a one-time installment loan that gives you a flexible, pay-over-time option. These loans, from companies like Affirm and Afterpay, often come with 0% interest periods, similar to store cards and zero-interest credit cards but not always.

Just be sure that you're clear on the terms and conditions for any kind of promotional deal the store offers when you sign up for financing. If you're offered low or 0% interest, make sure you can pay it off within the proper timeframe. It's important to be aware of the regular interest rate that you could pay after the promotional interest rate runs out.

As always, read the agreements and ask about hidden fees before you sign up.

5. Take out a personal loan

Personal loans are becoming a more common way to finance large purchases over a period of time, but they are generally more costly than using 0% financing or paying in cash.

If you know that you can't afford to pay off your credit card in full after charging the new ring, a personal loan could give you a lower interest rate and a chance to pay over several months or even a few years. The average personal loan APR is 9.34% according to the Fed's most recent data. Meanwhile, the average credit card interest rate is around 16.43%.

Just be on the lookout for fees. Some lenders charge origination, or sign-up, fees to take a personal loan. In addition, some lenders only let you borrow cash for particular uses, such as debt consolidation or refinancing.

LightStream, the online lending arm of SunTrust Bank, offers low-interest loans with flexible terms for people with good credit or higher, and there is little restriction on how you can use the money. A personal loan could be an option if saving cash or using a 0% APR credit card is out of the question. Just make sure you've read the fine print and are comfortable with the repayment plan.

Bottom line

Planning your dream proposal can be beyond romantic, but paying off debt is anything but. Start your marriage off on solid financial footing by making smart decisions about the engagement ring you buy. Take time to do your research, save your money and make the right choice for you and your partner.

Don't miss: The best 0% APR credit cards so you can finance your debt or new purchases interest-free

Information about the Amex EveryDay® Credit Card has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.

For rates and fees for the Amex EveryDay® Credit Card, click here

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.