04/30/2013 06:00 pm ET Updated Jun 30, 2013

Prom Time Is Prime Time for Overspending

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April showers bring May flowers, May brings prom season. High school juniors and seniors are getting ready to make memories that will last a lifetime. Unfortunately, without proper planning, parents can make debt that will also last a very long time.

Prom night costs range from $400 to $3,000 and up. American families with teenagers say they plan to spend an average of just under $1,100 for the evening. Parents must have an honest talk with their prom-bound kids, and setting a budget is key.

You and your children need to itemize a budget and decide what you'll pay for and what you won't. Prom time is upon us and your children may not have had the foresight to save enough money. This is a perfect time to lend some money to your children -- teach them about credit. Make it real and formal. Have them sign an IOU and be sure they work out a payment plan including when they will pay you off, the payment amounts and dates and yes, charge them some interest.

You'll see, that as we build a prom budget, most items are negotiable. Start with the non-negotiable item -- the prom ticket.

The ticket can run from a low of $20 per couple to a high of $250 per couple. Some schools still have their proms in their school gymnasiums, and that means the cost is on the low side. But that's rare today since most schools hold their proms at a hotel, country club or a restaurant. In today's world of equality it's perfectly acceptable for the couple to share that cost.

If the prom is at school, dinner may not be covered. That usually means your children will want to plan a dinner out with a group going to the prom. They will all be dressed up -- the restaurant will have to be appropriate, and that means it's going to be expensive. You could offer them the opportunity to have a dinner party at your home. Parents could help with the food to lessen with the cost.

Now for the clothes. The boys are easier, because they rent tuxedos. Depending on where they go and where you live, that could run anywhere from $125 to $150. And the fancier the tux, the more expensive. Formal shoes are usually included in the rental. Some families opt to have their boys wear a nice dark suit they may already own.

Girls' dresses can cost anywhere from $100 upward, and the sky's the limit. In 2011, a Philadelphia based company offered a diamond-studded prom dress for $13,997 -- reported to be the most expensive prom dress ever. Some communities have upscale resale shops. Be sure to check the sale racks at bridal stores for bargains. Don't forget to budget for shoes and accessories.

Let's not forget those "May flowers" -- a corsage for the girl and a boutonniere for the boy. Her corsage could run from $25 to as much as $150. Corsages can be pin-on or the kind worn on the wrist. Some girls will prefer to carry a small nosegay instead. His single pin-on flower will run about $10 to $20 if it's simple. Some supermarkets make up corsages and boutonnieres and they should be less expensive than the local florist. Have your children do some research before they order the flowers.

Now it's time to discuss the pre-prom buff and fluff. Your daughter and her friends may hit the tanning salon, then go off to the nail salon for a manicure and maybe a pedicure. And let's not forget the hair salon for a possible cut, color and of course a special do and make-up for the evening. They could also assume that a facial is a must. The cost? On the really low side for some of the essentials: $75. The high side could be $275 and up depending on how fancy the girls go. The best way to cut costs is to have the girls hold a manicure/pedicure/hair party at home. Have them keep it simple, spend their money on special hair accessories and hope that no one ends up in tears.

No one rides his bicycle to the prom. It has become common for kids to opt for the glamor of a limousine -- a really expensive extra for prom night. Typically, three or four couples get together and hire a limo at an average cost for the evening of $450. If eight kids are splitting it, it's not so bad, but if your teen decides on a private limo, the bill can be stiff. It's customary to tip the driver, so along with any charge for extra hours and a tip 15 percent to 20 percent, this bill will be a big one. You can offer to play chauffeur and drive your kids to the prom. Perhaps one of the parents could rent a special car and be the driver. The children may claim they'll be psychologically damaged for life by having Mom or Dad drive them, but a limo is a very expensive item.

OK, everybody say cha-ching! There will be a photographer at the prom to take posed couple and group or table shots. These picture packages can be expensive. The cost could range between $50 and $175. You can usually get a price list from your high school to determine what the costs are. These days everyone has digital cameras -- most kids have decent cameras built into their cell phone. Let them be photographers for the evening. You or they could create a special "Prom Scrapbook" with the pictures.

You can see how you and your children could easily reach that $1,100 average expenditure. Proms are one of those events that we keep in our memories and cherish. They will be much happier memories without credit card debt.

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