Weddingbee Blog

The average American wedding costs almost $28,000. Taking into consideration that the median household makes less than that, it’s alarming just how much one day can cost you.

Now, I won’t lie - I’m having a large wedding for 250 guests and it will cost more than the annual salary at my first job. Since I started wedding planning, several of my friends have asked me how we’re managing to pay for such an expensive event. My answer is the Korean kye.

When I first started working full-time, my parents knew that I wouldn’t be able to save much money on my own - I need discipline! So when a friend of theirs started a new kye they asked me to join.

The Korean kye, which means contract or bond, is a credit rotating system built on trust and honesty. It dates back hundreds of years when it was first used to pay official grain loans and military taxes. Since then, the kye has been transformed to finance small businesses, weddings, and funerals. These days, the kye is not only a financial function but a social one as well, where members meet every month to socialize, choose the winner, and celebrate. Kye’s can give a lending hand to new immigrants with no or little credit history (in fact, there are several papers out there which discuss how kye’s were one of the driving factors in helping the first Korean immigrants start their lives in the states). Plus, the monthly meetings are great places to socialize, network, and have good food and drinks.

A typical kye has fifteen members who contribute $500 every month. The winner of the jackpot (in this case, $500 x 15 = $7,500) may be determined by lottery or a group vote. The kye will continue until every member has won once, at which time the group can choose to disband or start a new kye.

So what happens if someone wins the first one and runs off with the money? This very rarely happens, for two reasons: 1.) you only join kye’s with people who you trust, and 2.) if you do, you will be a social outcast for the rest of your life. Koreans talk and gossip, and we all have families all over the world. Or we know someone who knows someone - unless you run away to a remote place with no contact with your previous life, you will get caught and there will be consequences.

I’ve heard of million-dollar kye’s in LA where people try to run off with the money and get caught. I’ve also heard of $50 kye’s in Korea among high school girls who pool the money for plastic surgery.

Now I know what you’re all thinking: how’s this different from depositing money into a savings account? Well, depending on how the kye is set up, you can actually earn interest if you decide to be one of the latter winners. For example, the kye that I’ve joined has a 10% interest rate. After you win, you must start putting in an extra 10% in addition to your monthly payments. So, in a sense, the first person to win is actually taking out a loan at 10% rate without any credit checks or leaving any blemishes on their credit history. The last person who wins makes 10% on their investment. What about those in the middle, who will come out about even? Even if you don’t profit at the end, you still join to help out your friends who may need quick cash to start a business, buy a car, etc.

I will be winning my kye towards the end of the cycle, which means that I will have made some money - enough to pay for my wedding and some change left over to start our new life together.

How are you paying for your wedding?