13th May 2013
It’s that time of year when the bells start tolling for couples-to-be: cash registers ringing up the cost of wedding gifts. Mid-April to July is a hard time for bank accounts and credit cards around the UK as it seems every young couple – and some not so young – decide to tie the knot. The average cost of a wedding present was £51 in 2012, according to research by First Direct. For couples that invite the average number of guests – a whopping 96 people – this can mean a wedding gift tally of nearly £5,000.
Many couples have already lived together before marrying and have all the prerequisites of everyday life. So rather than draw up the usual department store list of crockery, towels and bed linen, why not consider Mindful Money’s suggestions for an alternative wedding present? Jill Insley considers the alternatives.
Renewable energy debentures
The one thing you can guarantee you will need for the rest of your life is energy – power to heat your home, cook your dinner and light up your evenings. Costs of gas and electricity are expected to rise relentlessly, so why not offset the expense by asking your wedding guests to buy you investments in a renewable energy scheme that generates income by feeding power into the national grid? Abundancegeneration.com, a company started by Bruce Davis, the founder of peer to peer lender Zopa, offers debentures in solar and wind powered schemes in the UK, with a minimum investment level of £5. Debentures are a form of bond which entitle the investor to a share of the money earned by selling renewable energy. Returns are variable and will depend on how much the sun shines, wind blows and the inflation-linked rise in the Feed-in tariff which determines the price the installation will receive for the electricity it generates for the next 24 and a half years. At the end of that time the holder of the debenture will receive the face value of the debenture.
There are two ways of approaching wine as a wedding present: creating a cellar as an investment and building a wine collection for future drinking. Many wine merchants offer a wedding or gift service, and it’s worth checking their lists and charges to make sure you can select your favourites. Lay & Wheeler (www.laywheeler.com), a division of Majestic, doesn’t advertise a wedding service but is happy to open accounts for couples-to-be. This can be used to receive cash payments from guests, or the couple can construct a list of wines they would like bought for them.
The biggest ever downturn in the fine wine investment market bottomed in October 2012, according to Premier Cru Fine Wine, and has risen 15% since then. It predicts a further 10% increase by December.
From an investment point of view, Lay & Wheeler says you should be aiming to spend at least £1,000 for 12 bottles of bordeaux, burgandy, some champagne, and port – wines that have a long life ahead of them. Guests can buy one or two bottles, depending on how much they want to spend. You can also arrange to store the wine if you do not have your own cellar: this costs £9.36 for 12 bottles a year. Berry Brothers & Rudd (http://www.bbr.com) also operates a gift list, which allows guests to buy individual bottles with the exception of en primeur cases which have to be purchased in lots of six or 12, depending on the wine. Guests can also buy gift vouchers to go on the list. Individual bottle must be delivered to the recipient, but unmixed cases of 12 can be stored for free for the first three months, and for £10.80 per case per annum thereafter.
Vouchers are a common option for those defining what they want as a present, but it pays to be careful which store’s vouchers you opt for. In the last year, thousands of vouchers have been declared worthless when the store selling them has gone bust. It is completely legal for a store to refuse to allow customers to use vouchers once it has gone into administration. If this happens the person who bought the vouchers needs to make a claim in writing to the administrators with proof of the purchase. Even then there is no guarantee you will get all your money back and it can take up to 12 months for the claim to be processed, according to the consumer organisation Which?
Imagine the embarrassment of having to ask all your guests to organise claims on your behalf. Even if you are able to use the vouchers, you may still run into problems if you want to return the items you’ve bought with them, as the administrator may decide not to accept returns. If the item comes with a warranty and it is faulty, you should be able to claim a refund or repair from the manufacturer under the terms of the warranty. Admittedly it’s hard to imagine the likes of John Lewis going into administraton, but other department stores v closed down. Much more straightforward to ask for…..
Many people in the UK still find the practice of requesting cash as a gift rather distasteful. One person posting under a blog on the subject said: “Request, is that really what you meant? One shouldn’t “request” presents at a wedding! I find the whole wedding list thing totally offensive and the notion of a couple actually asking for cash totally wrong.”
Well, perhaps it is time to get over your squeamishness. What could be more sensible that asking for money, given that the wedding itself is likely to be the most expensive thing newly weds will have to pay for until they start having children? Asking for cash also means that the couple can buy a really expensive item – carpets, a new car, a loft conversion – that they might feel inappropriate for a normal wedding list. But couples still face the problem of deciding how to ask. Maybe you could ask for donations towards the flowers or honeymoon – after all, you don’t have to use all the money for that purpose. Alternatively, if you are saving towards your first home, why not set up a savings account entitled “Deposit” and send out details with the wedding invites? The one thing you should spare your guests, however, is asking for cash with a trite, twee poem such as “We haven’t got a wedding list, the reason we’ll explain, is to save you all the hassle as shopping is a pain”
. Anyone who sends that out that kind of request deserves to have their marriage annulled straight away!
Mindful Money asked two well-known financial experts for their ideas for wedding gifts.
Justin Urquhart Stewart, founder of Seven Investment Management and Radio 4 markets pundit, said: “Well the best thing would be some money to lock away in a nice balanced portfolio for several decades. On average a good, moderately adventurous portfolio should be able to get you an average of 7% after all costs providing you are willing to look for the longer term. At 7% your money doubles every ten years, so if you could ask for your family to say give you a pot of £2000, you would have £128,000 in sixty years – just enough to pay for the separation. Alternatively a case Vintage port or en primeur claret – but only the best- or a Georgian silver tea service – use it – enjoy it – sell it.”
Peter Hargreaves, co-founder of Hargreaves Lansdown: “A taxi for the Photographer with specific instructions to the taxi driver to make sure the photographer never arrives. The best moment of any wedding is when the photographer leaves it would be even better if they never arrived.”