Too broke to be a bridesmaid?

One of my friends just got engaged, and asked me to be in her wedding. While I am truly honored to have been asked, being in the wedding will honestly be a huge financial burden to me. When my sister got married, I ended up spending almost $1000 to be a part of the bridal party. Granted, this friend is a little more frugal than my sister, but still--things add up. This friend and I were super close in high schoo, but we lost touch after graduation and just re-connected about 6 months ago. I've met her fiance once, briefly. I don't know if any of this matters, but basically my question is: would it be terrible to tell her that I can't be in the wedding due to financial reasons? It is the truth. I am a grad student, and am only employed part time. At the same time, however, I don't want to ruin a friendship that just got back on track. Help please!