Behavioural Finance: How Does Social Pressure Drive Overspending In Indian Weddings?

Indian weddings are often marked by extensive celebrations, opulence and grand display of culture and tradition. For Indian families, weddings often bring an opportunity to showcase their social status.

The dazzling weddings also reflect the cultural diversity and distinct regional traditions across states. However, elaborate preparations for weddings and grand celebrations often lead to overspending.

Many families end up spending a huge amount for weddings, primarily driven by cultural factors, emotional decisions and the pressure to conform to societal norms. Community standards, religious practices and the fear of societal judgment also force families to arrange lavish weddings.

As per industry estimates, for a middle-class Indian family, wedding budgets can vary between Rs 5 and Rs 15 lakh in rural areas and small towns. This cost can even increase multi-fold in big cities and metros.

In India, wedding spending could be driven by emotional and social factors rather than logical decisions. Many families often prepare for extravagant weddings due to psychological and cultural biases. It’s not uncommon in India to rely on loans for large-scale spending like weddings.

Let’s take a look at how social pressure drives wedding overspending in India.

1. Display Of Social Status

In India, weddings are seen as an occasion to project social status. Many people also don’t hesitate to splurge money on extensive decorations, designer clothes, luxury venues and lavish feasts during weddings.

However, behind such extravagant weddings, there could be pressure to conform to societal norms. Families also organise grand events to maintain their social status within their community, despite financial stress.

2. Fear Of Being Shamed In Community

The fear of a potential criticism within the community or even social exclusion in certain societies for not meeting traditional standards compels families to organise grand events. Many families organise lavish community feasts and extensive celebrations just to meet the societal expectations and traditional practices. This often leads to inflated wedding budgets.   

3. Cultural And Traditional Norms

In many states, grand weddings are seen as an essential part of tradition. Certain cultural practices and rituals also lead to huge expenses. For instance, Indian weddings are not complete without gold jewellery and expensive gifts. Irrespective of their financial position and the cost of the gold, families are often compelled to buy the precious metal to meet societal standards.

4. Influence of Bollywood and Social Media

Bollywood films have significantly influenced the evolving Big Fat Indian Wedding trend in recent decades. Influenced by Hindi films, many people are opting for lavish events like destination weddings, designer outfits, elaborate decor and grand feasts.

Many also try to emulate the celebrity weddings, often leading to inflated budgets. The emerging social media culture is also shaping Indian weddings with elaborate rituals, cross-cultural practices, pre-wedding photo shoots and even extravagant engagement ceremonies.  

Many families, belonging to middle-class and lower-income groups, end up diluting their entire savings for weddings. Additionally, they rely on loans to meet the wedding expenses.

·      High debt burden can lead to long-term financial distress. This can also derail regular household expenses while affecting the ability to save for future needs.

·      The changing priorities for Indian weddings could also lead to financial uncertainties. As people don’t hesitate to splurge more for social validation, dependence on loans and depleting savings can lead to post-wedding regret and stress.

Indian society is rapidly evolving with modern culture and wedding traditions have also changed significantly over the years. However, a practical financial approach and cost-conscious assessment of wedding budget can help to make your grand day memorable without any distress.