Today’s couples probably already have a kitchen full of gadgets, a computer full of vacation photos, and a garage full of shiny, wheeled toys, so an expensive wedding, towering cake, and virtual honeymoon aren’t likely to add to their well-being and security. At this milestone of their life, all that may be missing is a home to call their own.
More soon-to-be brides and grooms are foregoing the traditional—expensive—wedding and choosing to bank their wedding trimmings and gifts. Literally.
A new trend, online crowdfunding-style registries, is a way for friends and family to contribute to home deposit goals. In this way, the newly married turn a gift-receiving opportunity into a way to achieve their homeownership goals.
What’s age got to do with it?
While many factors are driving this new trend, the older age at which couples are tying the knot is probably the most notable contributor. As older adults, homeownership is more of a priority than when they were younger. They have established their careers, traveled the world, and spent time finding a like-minded partner.
The average marriage age for Australian women as of 2017, was 30.1 years, and for men, it was 32 years in 2017. The older age at the time of marriage is also due in part to the increase in cohabitation—more couples are choosing to live together before marriage.
These older partners tend to be more practical and realize wedding trappings are here today and gone tomorrow. A place to call their own, on the other hand, maybe with them for many years.
Swanky gifts and nowhere to put them
For couples in small apartments, the addition of large, swanky gifts may not be a welcome addition. With every square foot of precious living space, there’s simply no room for a crystal punch bowl with service for 12. These high-priced gifts are also out of step with their style. They feel it would be better to collect arts and objects once they have established their home and in the design that fits their tastes.
When Cory and Mandy decided to get married during COVID-19 restrictions, they chose to skip the registries, wedding, and honeymoon in favor of saving money and contributions to their nest egg. Due to the lockdown, instead of invitations to the ceremony, they sent handwritten announcements afterward along with a link to the Zoom recording of the wedding that included only the parents and the couple.
The personalized notes thanked each person for being a part of their lives and told them of their plans to buy a home. Making it clear they did not expect a gift, they listed a link to a crowdfunding site and a non-profit they supported. They asked that in place of gifts a contribution be made to either account.
“I thought it was a great idea,” said Cory’s mother. “I’ve told my son since he started noticing girls, I wouldn’t buy him a wedding, but I’d buy him a house. I’m sure that influenced him and was one of the reasons they asked us to pitch in for a home deposit.”
Cory added, “We live in a 750-square-foot apartment. We couldn’t imagine filling it with gifts we don’t need—where would we put them? What we need is a house and trying to get a home deposit together with all the uncertainty around our jobs, has been a struggle. Our friends got it and pitched in.”
The idea of giving toward a new couple’s home deposit isn’t widely known or accepted—yet. Cory and Mandy may have had an easier time with this approach than others, but many generations consider asking for money tactless. According to Mandy, she felt their success lay within the average age of their guests (millennials and younger) and that they provided family and friends with the option to donate to a cause on the couple’s behalf.
Crowdfunding sites do make cash contributions more convenient, but it’s not free. They take a percentage of donations, which is hard to avoid no matter how one funds the gift.
Traditional gift registries ensure recipients get gifts they want, can use, and in a style they prefer. As convenient as they are for the shopper, the couple can end up with too much of a good thing. Giving to a home-deposit fund is less complicated than shopping and about the same as shopping online.
Crowdfunding vs. P2P
The practices behind lending, borrowing, and giving or donating money have undergone widespread transformations over the past decade. Innovation in money exchange has given rise to the concept of peer-to-peer lending and crowdfunding, among others.
In P2P, money is loaned to individuals or businesses using online services to match borrowers with a group of people acting as a lender.
For some, crowdfunding and peer-to-peer lending are the same. Both systems involve groups of people (rather than institutions) financially supporting a monetary need. The primary difference is that peer-to-peer lending is loan-based and has an interest rate, and traditional crowdfunding is equity-based.
Using crowdfunding to help someone gather a home deposit probably will not include equity in the house once purchased, but the basic process for collecting funds is the same.
Crowdfunding your home deposit
For couples considering a crowdfunded home deposit, don’t be timid. Consider this as a variation of a wedding registry. It’s simply another option for people choosing to buy a present—a suggestion of a gift you are guaranteed to love, nothing more.
In your shower and wedding invitations, and on your nuptials’ website, provide a link to the home-deposit registry as you would with any other registry. If you choose, give a heartfelt explanation about how much this would help you and your goals for new homeownership.
Whether or not someone chooses to give to the fund, be grateful. Send thank-you notes within one week of the wedding. If possible, share updates regularly on your progress, especially when you finally purchase a home. That’s because records can be vital in the mortgage-application process. Keep track of money that came in, from whom, and when.