Let’s get real for a minute. As prices for
everyday essentials, like food and gas, are soaring due to inflation, life
might seem a bit rough right now. But you don’t want to waste another minute to
pop the question to your longtime love.
Good news: You don’t have to wait! With the right financing option, you’ll be able to afford the perfect engagement ring and all of your daily necessities. We’re here to help you learn more!
What is Inflation?
Let’s put all of this into some context. Inflation refers to rising prices across one or multiple industries, eventually impacting a country’s entire economy. As a result, the value of your dollar decreases over time.
According to the Federal Open Market Committee, an inflation rate of roughly 2% is ideal for mild price fluctuations. But the U.S. is currently experiencing its highest inflation rate in 40 years! Recent data from the Consumer Price Index, which measures U.S. inflation, shows that food prices are about 10% higher than a year ago, and energy prices jumped nearly 35%. That means you can expect to pay roughly $4,100 more in gas and other daily costs this year, based on an estimate from financial and investing advice company The Motley Fool .
So, what causes inflation? There are typically two scenarios. At times, demand for certain products or services may increase, but the supply of those products stays the same. Prices then spike due to the increased demand. In the other scenario, demand for products/services remains constant, but the supply is limited. This in turn drives up prices.
We have seen supply issues throughout the COVID-19 pandemic as a result of lockdowns and worker shortages. However, the jewelry industry has also been impacted by the crisis in Ukraine. Nearly one-third of the world’s rough diamond supply comes from Russia, making the country the largest producer by volume.
But in response to Russia’s invasion of Ukraine earlier this year, President Joe Biden issued an executive order, prohibiting the import of natural Russian diamonds to the U.S. Now, there are even fewer sources of natural diamonds, and this is causing natural diamond prices to rise. Talk to your jeweler about alternative options.
Ways to Finance Your Engagement Ring
These are some popular avenues for financing an engagement ring. But beware! Each choice has drawbacks and inflation could make them worse.
Pay with cash: It’s ideal to pay for your ring upfront with hard-earned cash that you set aside. You won’t have payment schedules, interest rates, etc.
*Warning: But remember, prices are rising and the value of your dollar is decreasing. So, there’s a good chance that you’ll need to utilize additional cash that you previously allocated for other expenses.
Open a 0% interest credit card: This type of credit card lets you make payments on your purchase without paying interest for a certain amount of time (ex. 12 or 18 months).
*Warning: Although you don’t have to pay interest for several months, it’s still accumulating behind the scenes. If you don’t completely pay off your engagement ring before the specified time period, you’ll need to pay interest — on the entire cost of the ring, not just your remaining balance! And keep this in mind: The average interest rate for credit cards across the U.S. has now jumped to 17% — almost a full percentage point higher than six months ago!
Opt for a low-interest credit card: While this option requires you to pay interest on your ring, the rate is lower than the national average for credit cards.
*Warning: Similar to the previous option, you’ll be essentially penalized if your ring isn’t paid in full before the promotional period ends. If that happens, you’ll need to start paying nearly double the interest on your remaining balance! And don’t forget about potential late fees, which could be pretty high considering the current inflation rate!
Apply for a personal loan: If a bank, credit union or other institution approves this type of loan, you receive an amount of money and are expected to repay it in smaller, monthly installments.
*Warning: If you thought the average interest rate was already high, shoppers with bad credit are more likely to pay higher rates than those with good credit!
Finance with LendFirm
When it comes to engagement ring financing, the best way to manage inflation is choosing a financing partner, such as LendFirm. This online lender works with exclusive merchants, like Gage Diamonds, and looks beyond credit score to offer financing to shoppers with poor or no credit.
Despite current inflation trends, LendFirm has pledged not to raise its interest rates. So, you can still pay as low as 4.95% for 12 or 24 months on all Gage Diamonds pieces, from engagement rings to other fine jewelry. It’s a great option that will help you stretch your savings.
When you shop with us, simply provide a valid driver’s license or state ID; proof of a direct deposit from your primary employer/benefit provider into a three-month-old checking account; and record of a checking account in good standing. Applications are typically approved in 24 hours with no upfront costs.
Have a question? We can help!
Gage Diamonds is Chicago's premier jewelry showroom and online retailer of engagement rings, wedding bands, and fine jewelry. We offer a selection of rings featuring dazzling, handpicked diamonds, moissanites and other gemstones.
We’re committed to helping you find the ring of your dreams. For inspiration, browse our website or set up an appointment with a member of our trusted staff at our in-person showroom.
We offer no-credit-needed financing – apply and get your approval within 24 hours!
Pay over time, because love shouldn’t wait.