The price of an engagement ring is about more than just the diamond or gemstone; it's a symbol of love, commitment, and a future together. Choosing the right engagement ring and setting a budget that fits your circumstances can be a daunting task.
Historically, the budget for an engagement ring was often tied to one month’s salary, and later, it shifted to two or even three months of income. However, today, experts agree that deciding how much to spend should be far more nuanced, taking into account everything from your financial situation to your partner's style preferences.
Gone are the days of rigid "three-month salary" rules. According to Olivia Landau, a jeweler and CEO of The Clear Cut, “While the three-month salary guideline is still referenced by some, more couples today are choosing their budget based on their personal financial situation rather than following a fixed formula.”
For most couples, an engagement ring is the first major financial decision they will make together. It symbolizes a new chapter in their lives, and for many, it is not just about the ring itself but what it represents: a lasting commitment.
The key to navigating this decision is communication and mutual understanding, especially if you’ve already merged finances or have shared financial goals. As financial planner Cassandra Rupp from Vanguard suggests, “Couples should base their spending on their financial goals, and deciding on a budget together helps ensure there are no financial surprises down the road.”
For some couples, there may already be a clear idea of what the perfect ring looks like — a style chosen well in advance or perhaps a family heirloom passed down through generations. For others, the choice may come only after the proposal, and this can lead to significant decisions about cost and design. No matter when the conversation happens, the important thing is that it happens, and it should involve both partners' input.
According to Rupp, “This is often the first big short-term financial goal as a couple, and having a discussion about budgeting, saving, and long-term goals early on can help ensure that the entire engagement process is smooth.”
The first step in determining your engagement ring budget is evaluating your financial situation. This involves understanding your income, savings, and any significant expenses that may be coming up, whether that’s for the wedding, a new home, or retirement savings. Financial planners recommend that you consider all of your financial goals before settling on the ring you want to purchase.
For example, if you’re saving for other major life goals, such as buying a house or paying off debt, it’s crucial not to dip into those funds. Additionally, wealth typically increases with age, so a couple in their 30s or 40s might have more financial flexibility than a younger couple still in school or early in their careers.
Wedding plans also play a role in determining your engagement ring budget. If you and your partner have already set a budget for the wedding, it could affect how much you're willing to spend on the ring. Some couples may see the engagement ring as part of their overall wedding budget, while others may view it as a completely separate investment. Landau explains, “If you're planning a lavish wedding with a substantial price tag, you might be inclined to spend more on the ring. On the other hand, a smaller, more intimate wedding might lead to a more modest ring choice.”
Even if you haven’t finalized your wedding budget, it’s important to have that conversation after the proposal. From engagement rings to bachelor and bachelorette parties, wedding attire, and the honeymoon, wedding-related costs can quickly add up. Rupp points out, “Open communication about budgeting, saving, and managing debt is essential in setting you up for success.”
The design, material, and choice of gemstone are all factors that directly influence the price of an engagement ring. While diamonds have traditionally been the go-to choice for engagement rings, alternative gemstones like sapphires, emeralds, and rubies are growing in popularity, and they often come with a lower price tag.
According to a 2024 survey by Angara, the average cost of a one-carat natural diamond engagement ring is about $6,000, while a two-and-a-half-carat lab-grown diamond averages $3,750. Other gemstones, like sapphires or rubies, can cost between $3,000 to $4,500 for a similar size.
If you’re opting for something truly unique, custom-made rings can range dramatically in price depending on the materials used and the complexity of the design. For example, many jewelers see custom designs falling within the $5,000 to $10,000 range, though some can go much higher. Landau adds that her clients' budgets often range from $3,000 to $25,000 or even more, depending on their tastes and preferences.
Custom rings are especially appealing for couples who want to break away from traditional designs. “Our clients often don’t follow the three-month salary rule,” says Jennie Kwon, a jewelry designer. “Instead, they have a clear vision of what they want, whether it’s a diamond or a colored stone, and the budget they are comfortable with.”
When it comes to diamonds, the “Four Cs” — cut, color, clarity, and carat weight — are the industry standards used to determine value. However, how much you prioritize each factor can vary greatly depending on your budget. As Kwon explains, “Some couples may not care much about the color of the diamond, especially if they are selecting a yellow gold setting that can hide color imperfections. Instead, they might focus on clarity, which will have a greater visual impact.”
For couples on a tighter budget, choosing a smaller diamond or a gemstone like a sapphire or ruby can help stretch your budget while still creating a unique and beautiful ring. “A smaller stone can still be stunning if the design is thoughtful and well-executed,” Landau says. “It’s about striking the right balance between size and the overall aesthetic of the ring.”
While diamonds are the traditional choice for engagement rings, colored gemstones are becoming increasingly popular, offering a wider range of options for couples who want something different. According to Kwon, “We have many clients who love colored stones, and the budget can vary depending on the type of stone and the overall size of the piece.”
One of the best ways to get the most out of your budget is to work with a jeweler to design a custom ring. A custom ring allows you to select a design that fits your personal style and your financial situation, without feeling constrained by traditional norms.
“Our clients often come to us with a specific design in mind,” says Kwon. “They might have a certain gemstone or design they love, and we help them work within their budget to create something truly unique.”
Choosing an engagement ring is a deeply personal decision, and there’s no “one-size-fits-all” answer when it comes to how much you should spend. The most important thing is to make sure that your choice reflects your relationship and your vision for the future. Whether you go for a classic diamond, a vibrant colored gemstone, or a custom-designed piece, what matters most is the love and commitment it represents.
By making thoughtful decisions and having open conversations about your budget and expectations, you’ll be able to select a ring that fits both your financial situation and your style, without feeling pressured to follow outdated norms. After all, it’s not about the price tag — it’s about the promise it symbolizes.