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The Smart Way To Plan For An Engagement Ring Purchase

by Willyou.net * Aug 31, 2021

Key Takeaways

  • There is no right or wrong amount to spend on an engagement ring, although knowing what the ‘average spend’ is can help you to orient yourself, and figure out what you want (or need) your budget to look like.
  • Whatever your budget, aiming to spend around 80% of it on the diamond is a good rule of thumb.
  • Diamond carat is most significant factor behind its cost, although the Four Cs all have a strong impact on that final price tag, which is why it helps to understand what you do need – and what you don’t – in order to save money.
  • Price also increases exponentially with carat weight, so don’t expect for 2 carat diamonds to simply cost 2x as much as 1 carat diamonds. Higher weights come at a premium.
Round diamond Twisted engagement ring - How Much Should You Plan to Spend on Your Engagement Ring

There’s no right or wrong price to pay for your bride-to-be’s dream engagement ring, but there are plenty of ways to work out the most beneficial financial approach for you.

While some of the best things in life are definitely free, the same can’t always be said for everything, and definitely not that luminous diamond waiting to find its way onto the love of your life’s finger.

Engagement rings are one-off purchases (thankfully). They are, as far as purchases go, pretty expensive, too. Not only do you have to shell out for some of the most expensive things money can buy – diamond, gold and, if you’re pushing the boat way out, platinum – but you’ve also got to invest into your jeweler’s skills and expertise, or risk getting something that is, in a word, lacking.

Balancing those two aspects – quality of materials and quality of workmanship – isn’t something you can do with pocket change, but it doesn’t have to cost the earth, either.

  • The Diamond
    • Does Carat Determine Price?
    • How Much is a 1 Carat Diamond Worth?
    • How Much is a 2 Carat Ring?
    • How Much is a 3 Carat Diamond Ring?
    • Does Diamond Clarity Affect Price?
    • Does the Color of the Diamond Affect the Price?
    • Does the Cut of a Diamond Change the Price?
  • The Ring
    • How Much Does a Decent Engagement Ring Cost?
    • Is a $2,000 Engagement Ring Cheap?
    • How Much of Your Salary Do You Spend on an Engagement Ring?
    • Is $10K Too Much to Spend on an Engagement Ring?
  • Our Summary

The Diamond

Anyone coming up with a definitive plan of approach toward creating a solid, workable budget for their engagement ring will need to understand how diamonds effect the cost of the ring itself.

Does Carat Determine Price?

Yes – significantly. Although other factors (those infamous 4 Cs) also determine a diamond’s price, carat weight will play a decisive role in its market value.

Alongside your diamond’s cut, its carat weight will have the biggest influence over its impact. As we mentioned above, certain increases in carat weight can get considerably more expensive, real fast, and understanding why will be very useful to you going forward.

How Much is a 1 Carat Diamond Worth?

Anywhere from $2,000 to $17,000+, depending on the diamond’s quality.

A one carat diamond, as we mentioned above, represents a pretty coveted size in the world of engagement rings. A round cut one carat diamond will feature a diameter of around 6.5mm, which means that it’ll be sure to stand out on the finger, sparkle beautifully, and attract its fair share of attention from onlookers.

Nevertheless, imagine you have a pair of one carat diamonds in front of you. Now imagine that one of those diamonds features a few miniscule internal blemishes – like tiny specks of dust – as well as a vaguely yellow tint, a little less sparkle than you imagined. The other, however, is clear, eye-clean (no visible blemishes) and sparkles evenly across the entire surface of the diamond.

Even if both of those diamonds weighed the exact same amount, the first is going to be far, far less expensive than the other.

If a diamond holds incredibly high grades in it GIA Diamond Report, then it will be put onto the market for thousands of dollars above the ‘average’. This is why eye cleanliness is such a good rule to follow for most shoppers, unless they have a near-limitless budget.

How Much is a 2 Carat Ring?

A two carat diamond solitaire engagement ring will also vary significantly – generally between a bottom-range price of around $7,000, to much higher prices of $50,000+.

It’s probably helpful to break the ring down into its constituent parts. A two carat diamond can cost anywhere from around $6,000 – $60,000+, for exactly the same reasons that a pair of one carat diamonds can vary so much in price.

While the diamond is definitely the biggest deal-maker when it comes to pricing a ring, other factors can make a simple two carat ring far, far more expensive. If the ring comes from one of the best engagement ring brands, then it’s apt to cost a lot more than the average diamond solitaire.

Round diamond 3stone split shank engagement ring - How Much Should You Plan to Spend on Your Engagement Ring

How Much is a 3 Carat Diamond Ring?

For this, it would be ill-advised to dip below five figures. Around $17,000 – $19,000 would be considered the bottom range for a three carat diamond ring, while prices could go all the way to around $100,000.

Since diamond prices increase exponentially as the carat weight increases, it’s not a good idea to get into the habit of thinking that a three carat diamond will simply cost three times more than a one carat diamond.

A three carat diamond is considered to be pretty large for an engagement ring and, as a result, sellers will put a premium price tag on a quality diamond available in this coveted size. More than ever before, many brides-to-be are admiring the larger-than-life gemstones that make their way onto celebrities’ fingers, and are looking to break beyond the ‘one carat average’ that has set the standard for so many years now.

Does Diamond Clarity Affect Price?

Yes. A handful of diamonds featuring the same carat weight, color and cut could potentially vary in value by thousands of dollars if their clarity grades are significantly different.

As we mentioned above, those tiny dust-like blemishes found within so many diamonds are seen as undesirable on the diamond market – primarily because they impact not only the symmetry of the diamond, but also its ability to refract light and sparkle.

It is pretty likely that a one carat diamond featuring a below-average price (around the $2,000 mark) will be priced that low because it features visible blemishes which significantly interrupt the diamond’s light performance.

Even diamonds that look perfect to you could feature price-altering blemishes. This is what we mean by ‘eye clean’ – diamonds that look totally free from flaws to you, but which are available at a more affordable price because of their imperfections.

Does The Color Of a Diamond Affect the Price?

Yes – the closer to colorless a diamond is, the more it will cost.

This is not to be confused with colored diamonds, which are priced differently to clear diamonds.

Clear diamonds can, and frequently do, feature a yellow tint. This tint is often too slight to be noticed without a proper analysis under the right lighting, but it can be pretty noticeable.

The closer to a D grade a diamond is, the more desirable it will be on the market.

Does the Cut of a Diamond Change the Price?

Yes, definitely – both in terms of the quality of the cut, and the shape.

There are certain diamond cuts that sparkle more than others – and, obviously, an excellently cut diamond will sparkle much more beautifully than a diamond that has been cut poorly.

Round cuts cost more than step cuts, like the emerald. Some of the more complex cuts, such as the pear cut, require a larger investment simply because they are much harder to get perfect, and so afford a higher price on the market.

The Ring

While the diamond is important, it’s not the full story – and understanding how much you should be spending on your ring certainly requires you to know the full story. Here’s the lowdown.

How Much Does a Decent Engagement Ring Cost?

That all depends on what you think is ‘decent’. If we’re going by the status quo, then the average price of an engagement ring in the US is currently sitting pretty at around $6,000.

We wouldn’t recommend going much lower than that, although you can of course still get a lot out of a $3,000 – $5,000 budget.

While this is probably going to sound like stating the obvious, saving that extra couple thousand dollars before you start seriously shopping around can make a massive difference to the rings available to you.

You’ve probably heard it said how, at times, the smallest difference in carat weight can drastically alter a diamond’s value.  The difference between a 0.5 carat diamond and a 0.6 carat diamond will be considerably smaller than the difference between a 0.9 carat diamond and a 1 carat diamond, provided they’re all of comparable clarity, cut and color.

Is a $2,000 Engagement Ring Cheap?

When it comes to purchasing a diamond engagement ring, $2,000 is considered a low budget.

That’s not to say you won’t be able to find a beautiful ring for your bride-to-be, but that you will have to be realistic when it comes to finding a durable and strong setting and, of course, a diamond to sit at the center.

You’ll have to do plenty of research to work out what matters more to you – the size of the diamond, for instance, or how intricate the setting design is – and where you can save money. An honest, open meeting with your jeweler can help with this, and stop you from feeling as though you’re lost in the dark.

oval diamond solitaire engagement ring - How Much Should You Plan to Spend on Your Engagement Ring

How Much of Your Salary Do You Spend on Engagement Ring?

General consensus says 2-3 months, but here’s the thing: spending any particular portion of your yearly salary on your engagement ring is an old marketing trick – one that transformed the world of engagement rings back in the mid-century but which, these days, is more of a guideline than anything else.

There is no rule stating that an engagement ring is only valid if it costs exactly two months’ or three months’ salary. Some shoppers will save for years before they take the plunge, while others will be led by their current savings.

That’s not to say that the old saying isn’t useful. It can give you a handy framework around which to find a starting point, but don’t think of it in terms of ‘should’ and ‘have to’.

Is $10K too Much for an Engagement Ring?

No – in fact, it’s a great amount to have at your disposal when shopping around. With a $10,000 budget, you’ll be able to pick an incredible diamond that’s eye clean, beautifully cut, and big enough to really stand out on her finger.

Our guide on how to get the most out of your $10,000 engagement ring budget goes into this in much more detail, but suffice to say that this is a great starting point for any shopper – whether you have a strong idea what you want, or no clue where to begin.

How Much Should You Spend on an Engagement Ring Setting?

We’d recommend leaving around $2,000 of your budget set aside for the setting, but remember that you’ll be consulting with your jeweler way before you actually make the transaction.

Why does this matter? Because, after speaking with your jeweler, it may work out that your setting is less expensive (or, at times, more expensive) than you’d anticipated. If it’s less expensive, then you can rearrange your budget and spend an extra, say, $500 on the diamond.

This is a major benefit to consulting with your jeweler first. You can do your research beforehand, create a few ballpark figures for your ring and make sure it’ll fall within your budget, then, when you get to meet with your jeweler, get those rough numbers much clearer in your head.

In short, prepare to spend around $2,000 on top of the cost of the diamond, but don’t commit to any expense before your jeweler has gone through the finer details with you.

Our Summary: How Much Should I Spend on an Engagement Ring in 2021?

Using two to three times your monthly salary as a starting point is a great idea, provided you don’t feel too ‘tied down’ by it. We’d recommend keeping in mind that the $6,000+ mark is a great guideline for ensuring excellent quality from your diamond and setting, and that $10,000 will ensure you are able to push the boat out that little bit more in terms of quality, and the all-important carat weight of your center stone.

Still, what matters most is that you are able to find or create the diamond engagement ring of your (and, most importantly, her) dreams. For this, you need to find an excellent local jeweler with a vast knowledge and skillset in this area.

Not only will this ensure that you get a beautiful final piece no matter what your budget, but it will also make certain that you have that vital, expert guidance every step of the way. Making a good investment, and getting the most out of your budget, is about knowing the basics, and having the right guidance to fill in the rest of the blanks as and when they arise.