Financing an Engagement Ring: Personal Loans and Alternatives

Guide to Financing an Engagement Ring With a Personal Loan

Jackie LamUpdated June 3, 2025

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Editor’s note: Lantern by SoFi seeks to provide content that is objective, independent and accurate. Writers are separate from our business operation and do not receive direct compensation from advertisers or partners. Read more about our Editorial Guidelines and How We Make Money.

Getting hitched to your beloved can be costly. One of the most significant purchases is the engagement ring. The average cost of an engagement ring in the United States is about $5,200, according to The Knot. While most anyone would like to pay for an engagement ring with cash, the reality is that you might need to tap into financing to propose properly. Below we highlight several engagement ring financing options you may consider.

Cost of Engagement Rings

As mentioned above, the average cost of an engagement ring is about $5,200. Depending on the cut, color, clarity, and carats — the 4Cs of diamond quality — some engagement rings can cost tens of thousands of dollars.Can you finance an engagement ring to help cover the costs? Yes, you may consider personal loans or other engagement ring financing options if you’re wondering how to finance an engagement ring.

Personal Loans for Engagement Rings

You may take out a personal loan to finance the cost of an engagement ring. A personal loan is a lump sum of money that you borrow and repay over a set term.Personal loan lenders may charge interest and fees. The average personal loan interest rate can range from 7.99% to 35.99%, depending on your creditworthiness.Here are some factors to consider if you’re wondering how to finance an engagement ring:

Lenders may calculate interest on a personal loan using a simple interest formula
Lenders may offer large personal loans of up to $100K
Borrowers may also use personal loans as wedding loans

Pros and Cons of Personal Loans for Engagement Rings

Borrowers may use a personal loan to help finance the cost of an engagement ring. You may want to consider the pros and cons of personal loans when looking to compare top personal loan offers.As mentioned above, the average interest rate on engagement ring personal loans may range from 7.99% to 35.99%, depending on your creditworthiness. The annual percentage rate (APR) of a personal loan may approach 35.99% if you have bad credit. Here’s a closer look at the pros and cons of personal loans:

Pros of Personal Loans	Cons of Personal Loans
• Money is offered in one lump sum upfront	• Need to apply and qualify for a personal loan
• Monthly payments are usually the same throughout the life of the loan	• Can charge high rates of interest and origination fees
• It can help you buy an engagement ring without pledging assets as collateral	• Hard pull of your credit when applying may have a negative impact on your credit score

Tips for Comparing Personal Loans for Engagement Rings

Here are some tips on how to find a personal loan for an engagement ring that suits your needs and budget:

Compare Rates

The cost of the personal loan engagement ring hinges on how much you’ll end up paying in interest charges and fees. Many personal loans have a fixed interest rate, but different lenders may offer different APRs. You can compare rates and choose a personal loan that’s right for you.

Compare Total Costs

Beyond interest rates, look at what fees might come tacked on to a personal loan. This might include an origination fee, documentation fee, late fees, and prepayment penalties. Comparing total costs can help you select a personal loan that’s right for you.

Check Requirements

Before deciding on which lenders you’d like to pursue, check their lending requirements to help determine your odds of approval. Common things a lender will take into consideration are:

Your income
Your debt
Your credit score and profile
Amount and length of the loan

If your credit is less-than-stellar, it might be difficult to secure a personal loan. Personal loans for fair credit tend to have higher interest rates and less favorable repayment terms. Borrowers with good or excellent credit may have greater access to credit, in addition to securing better rates and terms.Recommended: Personal Loan Approval Odds

Alternatives to Personal Loans

If you’re tight on cash, here are some additional engagement ring financing options you may consider beyond personal loans:

Financing an Engagement Ring With a Credit Card

Putting an engagement ring on your credit card can be an easy way to finance the transaction, especially if you use an existing card. One of the downsides to credit cards is they may charge high rates of interest. Cardholders who pay off their statement balance during the credit card grace period may avoid interest charges on purchases each billing cycle.

Financing an Engagement Ring With a Buy Now, Pay Later Loan

Buy now, pay later (BNPL) is a popular form of short-term financing for those purchases you can’t afford to pay for upfront. BNPL options typically put you on a payment plan that’s spaced out over a few weeks or several months. This can be a viable option for financing an engagement ring if you’re looking for alternatives to cash and personal loans.

Financing an Engagement Ring With a Jeweler Loan

Similar to BNPL lenders, some jewelers, department stores, and retailers offer an in-store payment plan for big-ticket purchases. These plans may include a 0% APR promotional rate. However, depending on the retailers and the specifics of their in-store payment plan, you might owe interest if you haven’t completed your payments by a certain date.

Tips for Buying an Engagement Ring

Here are some tips for buying an engagement ring:

Stick to your budget. Engagement rings can be quite costly depending on their composition of metal and gems. You can set an engagement ring budget and shop around for rings within your budget.
Research your financing options. Buying an engagement ring with cash can deplete your savings. You may have a variety of financing options to consider, such as personal loans, credit cards, or in-store financing. You may choose a financing option that’s right for you.
Understand the pros and cons of borrowing money. Borrowing money can help you finance a costly transaction, but some financing options may charge interest and fees. You may compare APRs and choose an engagement ring financing plan that’s right for you.

The Takeaway

Buying an engagement ring with cash can be difficult for some buyers. Engagement rings may cost thousands of dollars depending on their composition. Consumers with steady income may qualify for engagement ring financing to complete the transaction.If you need funding to buy an engagement ring, Lantern by SoFi can help. Just fill out a simple form and explore personal loan offers in our marketplace.Compare personal loan rates and apply in minutes.

Frequently Asked Questions

Can you take out a loan for an engagement ring?

What is the average amount spent on an engagement or wedding ring?

What are the pros and cons of personal loans vs. payment plans for engagement rings?

Photo credit: iStock/marchmeena29

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About the Author

Jackie Lam

Jackie Lam is a freelance writer with experience covering small business, budgeting, freelancing and money, and personal finance. She has written for more than 60 outlets, including Salon.com, CNET, BuzzFeed, Business Insider, and Time's NextAdvisor. She is currently working on her AFC® financial coaching certification to help artists, freelancers, and small businesses.

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