Marriage Or Mortgage: Which Is The Better Investment?


    Both weddings and home purchases can lead people to think irrationally or to spend money – especially in a rush to “gain a foothold in the real estate market” Mortgage rates are historically low. How can a couple decide how to better use their hard-earned savings?

    Let’s start with weddings. The costs associated with their big day can vary dramatically from couple to couple, depending on their wedding plans and the size of their family. The dollars also vary widely between industry estimates. According to Wedding Wire’s 2019 Global Wedding Report, the average Canadian wedding costs US $ 21,900, or CAD 29,059 at the 2019 average exchange rate. Consumer data company Statista put the average Canadian wedding at a significantly higher US $ 42,401 in 2017.

    Given the national average home price of $ 678,091 in February 2021, a 5% minimum down payment would be $ 33,905 – or about the average cost of a wedding.

    This begs the question: do young people make marriages difficult by making their wedding budget too high? Are you exchanging a deposit with your friends and family for a half day party?

    Probably the rational choice for a couple in the long run is to forego an expensive wedding. But many brides, grooms, and their families celebrate traditional wedding ceremonies and receptions and feel the desire or pressure to do so.

    COVID-19’s precautions have prevented many couples from hosting large weddings. That’s bad on almost every level, but a humble wedding could be financially good for a couple.

    If a 30-year-old married couple invested $ 35,000 with a 5% annual return, they could get to over $ 193,000 upon retirement at age 65. Granted, $ 193,000 they would live to buy in the future due to rising costs of not nearly as much over time, but it’s the same as about $ 97,000 in today’s dollars, assuming 2% annual inflation. This corresponds to a salary of approximately USD 140,000 after taxes (varies by province). Could not having a wedding allow you to retire a year or two earlier? Absolutely. Is it romantic to escape in the town hall? Absolutely not.

    Money stress is commonly cited as one, if not the main, issue among spouses. And disagreement about the cost of a wedding, verbalized or not, could set the stage for marriage.


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