How Much Should an Engagement Ring Cost in Australia?

The right amount to spend on an engagement ring is the amount you can pay in full, without borrowing, without dipping into the house deposit, and without needing to explain the number to anyone. That is the whole answer. Everything below is about how to arrive at it and what the money actually buys once you have.

I make engagement rings in a Southbank studio in Melbourne. I have had this conversation across the bench several hundred times, and the pattern is always the same: people arrive with a number they got from somewhere else, and the number has nothing to do with their life.

The three months' salary rule is an advertisement

It is worth being precise about this, because the rule is repeated so often that people assume it came from etiquette or tradition. It did not. It came from De Beers.

De Beers ran the advertising campaign that created the modern diamond engagement ring market, beginning in the United States in the late 1930s with the agency N.W. Ayer. The salary guideline was part of that campaign's machinery. It started at one month's salary. It became two months in the United States. In other markets it was pitched differently again, because it was a marketing input, tuned per country to whatever the local audience would accept. The three months version most Australians have heard is a later inflation of the same idea.

The rule was invented by a diamond cartel to increase the amount people spent on diamonds. It worked extraordinarily well. That is its entire history. It is not a tradition, it is not etiquette, and it has never had any connection to what a ring is worth or what a marriage needs.

If you take one thing from this article, take that. Any figure that starts with your income is a figure designed by someone who benefits from it being large.

Why the "Australian average" is not much use either

You will find averages quoted in Australian wedding media. Treat them carefully. Most come from retailer surveys or insurer data, so they are drawn from people who bought at a retailer and then insured it. Anyone who spent very little, bought secondhand, inherited a stone or made something themselves is largely invisible in that data, and averages are dragged upward by a handful of very expensive purchases in a way a median would not be.

An average tells you what one sample of buyers did. It does not tell you what a ring should cost. I would rather give you the variables that genuinely move the number, because those you can act on.

Stone type moves the number more than any other decision

Not carat. Not metal. Not the retailer. The largest lever on an engagement ring budget is which stone you put in it, and the gap between the options is bigger than any other choice on the list.

Set a moissanite, a lab grown diamond and a mined diamond of the same size, in the same setting, and the prices sit at three completely different levels. Same millimetres across the top, same look on a hand at conversational distance, three different numbers. Our moissanite designs start at AU$800. Our lab grown diamond designs start at AU$1,350. Nothing else you decide has that range. Moving from 14ct white gold to platinum changes the price. So does moving from a solitaire to a halo. Neither changes it the way the stone does.

If you have not worked out where you sit on that question, moissanite versus lab grown diamond is the comparison to read before you set a budget, not after.

The unflattering part, since I sell both: neither moissanite nor lab grown diamond holds value. You will not resell either for what you paid. Mined diamonds do not hold value either, which almost nobody in the trade says out loud, but I want to be clear that I am not claiming an investment case for what I make. Buy a ring as a thing to wear, not as an asset.

What the budget actually buys

Rather than name an average, here is what changes as the number moves. These are the trade-offs, not price promises.

At the entry level, you are buying a real stone in a well made setting, in a smaller size or in moissanite. Our moissanite designs begin at AU$800 and our lab grown diamond designs at AU$1,350. What you give up is carat weight, not quality. A well cut half carat in a properly finished setting beats a poorly cut one carat in a thin one, every time.

In the middle, size arrives. This is where a lab grown diamond around a carat, in good colour and clarity with an excellent cut grade, becomes ordinary rather than exceptional. Most people land here and most people are happy here.

Above that, you are paying for the last increments: two carats and beyond, D and E colour, VVS clarity, platinum, more complex settings. Each is real. None is visible from across a table. This is where I most often tell people they are buying grades rather than a ring.

What I would protect at every level is cut grade. It is the only line on a certificate that changes how a stone behaves in a room. Colour and clarity you can drop. Cut you cannot.

Ask yourself these five questions instead of picking a number

Are you paying for it in cash? If the answer is no, you have not found your budget yet, you have found a repayment schedule. Interest on a ring is the most expensive thing in this article. Buy-now-pay-later on jewellery is the same problem with a friendlier interface.

Does your partner want size, or a specific design? These pull in opposite directions. Someone who wants presence on the hand should spend on carat and shape and accept G colour and SI1 clarity. Someone who has been sending you photographs of one particular vintage inspired setting for two years does not want a bigger stone, they want that setting made properly, and the money belongs in the workmanship.

Will there be a wedding band, and have you budgeted for it? There almost always is. If the engagement ring has an unusual profile or a low set stone, the band has to be shaped to fit against it, which is a custom job. Deciding this now is much cheaper than discovering it eleven months from now.

What does your partner do with their hands? Nursing, climbing, animals, hospitality, gardening. If the ring will be knocked, put money into shank thickness and claw work, not clarity. A stone in a badly made setting is a stone you will eventually lose.

Will this number still feel fine in five years? Not on the day. Five years in, with a mortgage or a child behind you. If the answer is uncertain, come down.

The costs people forget

The ring price is not the total. These are the ones that surprise people.

Insurance. Specified item cover on contents insurance, or a standalone jewellery policy. It is an annual cost for as long as you own the ring, and across decades it can exceed what the ring cost. It is still worth having. Budget it as a recurring line, not a one off.

Valuation. Insurers usually want a written valuation for a specified item, and a valuation for insurance states a replacement figure, not what anyone would pay you. Do not read it as evidence you bought well. It is an insurance document.

Resizing. Fingers change. Pregnancy, weight, age, heat, arthritis. Most people need at least one resize in a lifetime of wear and plenty need several. A resize at a retail jeweller is not trivially cheap, and some designs, full eternity bands and channel set rings in particular, cannot be resized at all and have to be remade. Ask before you buy.

Our own policy is one free resize within three months of purchase, up to four sizes up or down, or two sizes on a pavé ring. After that a resize starts at $80 and varies with the metal, and you pay postage to us while we pay the return postage. Get the equivalent number from anyone you are comparing us to, because across forty years of wear it adds up.

The wedding band. Plan for it as part of the same purchase even if you buy it later.

Rhodium plating. White gold is plated with rhodium for its bright white finish, and that plating wears and needs redoing periodically. Platinum does not, but scratches to a soft patina instead. Neither is a fault. Both are maintenance.

Sizing. If you are proposing as a surprise and guessing the size, you are gambling on a resize. We send a free ring sizer before anything is cast, which removes most of that risk.

What I would actually do

Decide the stone first. Set the total from what you can pay in cash, then subtract insurance for the first year and something for the band. Spend what is left on cut grade and on the setting, in that order, and let carat take whatever is left over.

Then stop looking. The comparison never ends if you let it, and the marginal grade you talk yourself into at midnight is not one anyone will ever see.

If you want to talk it through before committing to a number, we do design consultations by video call and by appointment at the studio. You can book an appointment, and you can see where the ranges start on the lab grown diamond engagement rings and moissanite engagement rings collections.

Common questions

Is two months' salary the correct rule in Australia?

No. It is not a rule and it never was. It was an advertising guideline created for the United States market by De Beers, and it was set at one month before it became two. Australia inherited it through media, not through custom.

Is it acceptable to spend under AU$1,000 on an engagement ring?

Yes. A moissanite in a well made setting sits in that territory and will outlast most of the mined stones sold for ten times the figure, because the setting is what fails, not the stone. Our moissanite designs start at AU$800.

Should I spend more because it is a lab grown diamond and they cost less?

That is the trap. Lab grown prices have fallen substantially since 2020 as production scaled, and the correct response is to buy the same ring for less money, not a much larger stone for the same money. Take the saving if you want the saving.

Do I need a valuation?

If you are insuring the ring as a specified item, your insurer will usually require one. It is a replacement cost document, not a resale figure.