How to Throw a Party on a Budget

By Jean Chatzky

Throw the perfect party without breaking the bank.

Have you got a big event coming up? Something really worth celebrating in your family, like a wedding, golden anniversary, baby shower, special birthday, bar mitzvah, Sweet 16 or Quinceanera? Anyone who's been listening to the radio show knows that's where my head has been of late. And I'm a big believer that there's nothing quite like the memories life's biggest milestones can create. Unfortunately, that's also why it's so easy to forget about pesky details like price tags and budgets.

The reality is that even the most beautiful memories can be overshadowed by a debt hangover. In fact, overspending on a big event is a surefire way to spoil it in the long run. Instead of the fanciest venue or the most elaborate sit-down dinner, concentrate instead on this stellar piece of advice from David Tutera, a celebrity wedding and party planner and a former guest on my Oprah Radio XM radio show: "If a guest can go to a wedding and walk away knowing more about the bride and groom, that's what makes a wedding much more unique." The same goes for any other type of special event. It's about the person, not the party.

I'm not saying it isn't tempting to splurge. Restraint is especially difficult when everyone around you seems to be spending uncontrollably. The average price of a wedding these days is $22,000—that could buy you a new car. And it's not unheard of to drop $20,000 on a Sweet 16, complete with chocolate fountains, designer dresses I'd kill for and the child of honor's name lit up in neon.

So how do you throw a wonderful party that everyone will cherish without spending the equivalent of the GDP of a small country? Here are some things to keep in mind before the planning begins.

Set aside cash. It's never too early to start saving for the big day. If you can avoid using plastic on a $1,000+ bill, you'll bypass those hefty interest charges. Twelve to 18 months in advance of the shindig, figure out as accurately as you can what it's going to cost you. Divide the total by the number of paychecks you get in a year and start automatically shuttling that much money into savings. You can even open a separate savings account if it'll help you keep your fingers off!
Go in with your eyes wide open. Whether you're planning a wedding, a bar mitzvah or a 25th anniversary party, "you need to make a conscious choice about whether it's more important to you to spend thousands on the event or save the money for some future financial need," says financial planner Ross Levin. "There isn't necessarily a right or wrong answer, but the decision ought to be intentional."
Don't be afraid to put on the brakes section. If a voice in the back of your head is starting to say this is getting out of control—listen carefully. (And try not to listen to all those service providers who are encouraging you to go overboard on their specialty alone. Do it with each one and your budget is completely out of whack.) Besides, you don't want to end up resenting the money you spend. Nor do you want to overindulge so much that you, the guest of honor, and all the participants lose site of the real meaning of the milestone you're celebrating.

You can get so overwhelmed with details of a big party—what flowers will be in peak bloom, what you're going to wear, what the guests will want, salmon or filet mignon?—that you can easily lose sight of what you're really celebrating. Use the following questions at your next Money Group meeting to keep everyone focused on the meaning behind the important parties in your lives and the best ways to plan and pay for them.

What's your definition of a dream party? (Jean's take: It doesn't have to be formal to be special. Some of the best parties I've been to have been casual backyard affairs. It's the atmosphere of being around my best friends on a beautiful summer night that I remember—not the thread count in the tablecloths!)
What do you want guests to remember most about the celebration? What special feeling do you want to create? (Jean's take: For my son's bar mitzvah, we came up with a boardwalk theme. Nothing sent that message as much as the little bags of handcut fudge and salt water taffy (from my favorite Atlantic City purveyor James) that we sent guests home with.)
How much can you realistically afford to spend?
Are you willing to go into debt to pay for this? How much?
If the party is for your child, think back and describe a similar event in your life. (Jean's take: Often parents get caught up in trying to give their child a bigger, better party than they had, whether it be a wedding, bar mitzvah or Sweet 16 party. Try to leave your own experiences out of the equation and deal with the here and now.)
Have you gotten plenty of input from other family members? (Jean's take: You don't want siblings, cousins, etc. to feel left out of your parents' golden anniversary or another big family event—plus, they may be able to pitch in on the tab. Delegating tasks and costs can help make a big event doable.)
How good of a negotiator are you? Are you ready to bargain? (Jean's take: You can get discounts and deals on just about every aspect of a big party, but you've got to be willing to ask. I actually sat down with the caterer for the bar mitzvah and said to him, 'This is just too expensive. You'll have to come down in price if we're going to use you.' You know what he said? 'Your party is so casual, I'd use paper goods rather than renting china.' Not only was he right in terms of the feeling of the party, that one suggestion saved me $35 a head!)
Do you have trouble saying no? (Jean's take: You may have to say no during times like this. Cutting the guest list, going for the less expensive menu or standing up to an insistent, albeit, well-meaning family member are part of party planning.)
Should you hire an expert to help? What do you think are the pros and cons?
What's your biggest fear/anxiety about planning this party? What concrete steps can you take to eliminate the potential for those problems?

Stay on budget. That's the name of the game when you're planning any kind of special celebration. Here are three tasks you can do this month to make sure your special day creates plenty of cherished moments without breaking the bank.

Set realistic expectations.
In a quiet moment, jot down three goals you want to achieve with this celebration. If it's your parents' 50th wedding anniversary, for instance, you may want the party to serve as a family reunion of sorts as well as a way to honor your parents' marriage. Or your dearest wish for your daughter's wedding may be to launch her into a happy marriage as well as celebrate her new independence. Bring your list to your next Money Group meeting and get input from other members. They'll make sure you're being realistic and truthful. (No, it probably isn't a good idea to throw your husband a surprise 50th birthday party just because your sister and your best friend did the same thing for their husbands.) When you have clear, meaningful goals in mind, it makes it easier to avoid overspending on over-the-top but often meaningless extras.

Make a budget.
Use my party planning tool to itemize each and every expense, including space, food, drinks, flowers and incidentals like personalized paper napkins. Seeing how everything works together will help you avoid a common party planning mistake—spending too much on one area, like food or an open bar, and not having enough left over for other expenses. After you've totaled up everything, go ahead and add another 10 percent buffer for last-minute cost hikes and unforeseen expenses.

Find ways to cut back.
If you're like most people, adding up the various expenses of a big party can give you a severe case of sticker shock. That's when it's time for you and members of your Money Group to look for some creative cost cutting. Some ideas: Skip the sit-down dinner and host an extended cocktail party with passed hors d'oeuvres instead. Or, in addition to wine and beer, offer a signature cocktail instead of a full bar. Cutting the guest list by just a few names can shave hundreds off the final tab. Together, you and your group can brainstorm other great ideas.

Envision the celebration of your dreams, then get real. Figure out how much you need to make your perfect party come to life with some simple math.

Download Jean's Party Planning Worksheet.

Still looking for ways to cut back on your spending to save for the big day? Keep track of what's coming in (and going out). Jean's Money Tracker can help you monitor your spending and see where you can save.

Download the money tracker!

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Published 01/01/2006