For better, for worse, that'll be £20,000

However squeezed their wallets, couples still splash out on weddings. Alison Shepherd looks at ways to cut the cost, but not the fun

Wedding bells may evoke warm thoughts of romance and love, but with couples blowing on average £20,000 on just one day, a cool head is called for.

Despite the high cost, the desire for fairy-tale nuptials appears not to have been curbed by the current squeeze on bank accounts. Instead, families are seeking cheaper ways to create the dream.

"DIY is the way to go now," says Helen Crockett, the features editor at Brides magazine. "Rope in family members. Could your mum bake the cake, or your friends help arrange flowers? We hear from our readers that getting guests to help in this way makes them feel more involved. It makes the event more quirky and individual. There is absolutely no stigma involved."

Ms Crockett's other tips for a cheaper wedding include haggling over every detail. "There is nothing that is not open to negotiation," she says. "Avoid peak seasons; buy your wine in Calais or at the supermarket; go for a buffet, rather than a sit-down meal; and, most importantly, avoid using the 'W' word until the very last minute when shopping around.

"Many suppliers will hike up their prices as soon as they hear 'wedding'. Tell them that you're pricing a 40th or 50th birthday. Leave 'wedding' until after they quote if at all possible," she says.

Another sign of the times is the rise in the number of couples – now up to 45 per cent of them, according to Wedding magazine – who are willing to break one of the last taboos and ask guests for cash instead of handing out the dreaded gift list.

"There has definitely been a cultural shift," says Martin Bamford, a financial planner and the managing director of Informed Choice.

"But many people are still uncomfortable with the idea of just handing over money, in which case travel vouchers could be a good choice. If the guests are family, the cash could be given in terms of a savings account or investment fund, but friends setting up a third-party account would probably get far too complex."

Mr Bamford also points out that such cash gifts are exempt from inheritance tax rules, as each parent can give up to £5,000 to a marrying child on or immediately after the day of the wedding, grandparents £2,500 and non-family £1,000, without it counting as part of the giver's estate when the taxman calls, should the guest die within seven years of the big day. This is on top of the £3,000 a year that every individual is allowed to give for any reason.

With all that cash arriving in embossed envelopes, and pouring out of the couple's bank into the suppliers' coffers, it's no wonder that wedding insurance is a growing industry.

The most obvious, and universal benefit of an insurance policy is to cover the couple's costs if the wedding has to be cancelled for any unavoidable reason. But in addition to this, policies offer cover for loss or damage to essential items such as the bride's dress, the cake or the couples' rings; and for the failure of a supplier to fulfil its side of the contract.

"Many things you buy for your wedding will be protected if you use your credit card to pay," says Cathy Neal, a senior researcher with Which?. "All cards cover goods or services between £100 to £30,000. And many home contents insurance policies will cover gifts around a wedding date. But sometimes you may have to pay in cash for a particular service, for instance employing an individual caterer, in which case a separate insurance policy may be worth it, just in case that supplier fails to deliver."

Although Ms Neal says wedding packages are "much of a muchness" in terms of what they cover, there is a huge variation in the range of premiums and payout limits on offer.

For instance, at the cheaper end of the market, for a £20 premium, E&L will insure up to £6,000 for a cancellation; £5,000 for supplier failure; £4,000 for damage to or theft of gifts, and £3,000 for loss of photographs. Whereas Greenbee offers up to £50,000 for cancellation; 50 per cent of the cost of supplier failure; £15,000 for theft of gifts; and £3,750 for loss of photographs, for a £355 premium.

"It's important that you look at what you need, how much you are spending, and what you fear may go wrong, and check the individual plans before you take out any policy," says Ms Neal.

It's not only the couple who can take out insurance, she adds, but also anyone who has paid for any aspect of the celebration. Ms Neal also warns that although several insurers will offer travel insurance as part of a wedding package, the cheaper, more comprehensive option will probably be a standalone travel policy for the honeymoon.

"Unfortunately, none of the insurers will pay up for either the bride or groom changing their minds," warns Ms Neal.

And a final word of warning for all lovebirds comes from the cool head of Mr Bamford. "Taking love and romance out of the equation, weddings can be extremely expensive events," he says. "If you're struggling day to day and the housing ladder is a long way off, is it really worth spending what could be a deposit on a home on one day which will disappear in a flash, rather than create a solid foundation for your years together?"

Expert View

Cathy Neal, Researcher, Which?

"With the thousands of pounds that can get spent on a wedding, an extra £25-£30 for insurance is tiny, for peace of mind. But you need to check exactly what coverage is offered and compare it with your needs, to ensure you get the best value and that you're not paying twice for protection already offered by your credit card or home contents insurance."