High unemployment, soaring gas prices and mortgage crisis be hanged: Americans are spending more than ever on the really important things, like the high school prom.
A new survey from Visa Inc. shows that the average American family with teenagers plans to spend $1,078 -- that's for each child -- on the prom, a 33.6 percent increase over the $807 spent last year.
And those in the lower income brackets, less than $50,000, plan to spend even more -- $1,307 per child, the survey found. And those in the very lowest bracket, under $20,000, plan to spend $1,200 -- more than 6 percent of their annual income.
But the most staggering number came from those families earning between $20,000 and $30,000, who plan to spend an average of $2,635, which would represent almost 9 percent of annual income for those making $30,000. Those families are just above the federal poverty level, which is $23,050 for a family of four.
"Prom season spending is spiraling out of control as teens continuously try to one-up each other," said Jason Alderman, senior director of global financial education for Visa. "It's important to remember that the prom is a high school dance, not a wedding, and parents need to set limits in order to demonstrate financial responsibility."
That advice is apparently falling on deaf ears, however, as the survey found that parents are planning to pay an average of 61 percent of the cost. Alderman said that's one of the problems.
"One of the reasons that prom spending may be running amok is that parents are paying the vast majority of the costs, giving teens little incentive to economize," he said.
There were sharp regional differences in the amounts people were planning to pay. The Northeast was the highest by far, at $1,944, followed by the South at $1,047, the West at $744 and the Midwest at $696.
