Watch CBSN Live

Prom time: Get ready for the $1,100 bill

(MoneyWatch) Forget borrowing dad's Buick and tux. Today's teens are spending an out-sized fortune on the high school prom, with the average family shelling out a whopping $1,139, up from $1,078 the year before, according to Visa Inc.'s annual prom survey.

Worse, lower income families -- and single parents -- spent more than families in higher tax brackets. Families earning less than $50,000 a year plan to spend $1,245, while parents who make over $50,000 will spend a little less -- $1,129. Single parents plan to spend $1,563, almost double the $770 that married parents plan to spend.

"Prom has devolved into a competition to crown the victor of high school society, but teens shouldn't be trying to keep up with the Kardashians," said Nat Sillin, Visa's head of US Financial Education.

Other survey results show substantial disparities between the country's geographic regions, with Northeastern families spending the most -- an average of $1,528 -- and Midwestern families spending the least -- $722. Southern families will spend an average of $1,203; while Western families intend to spend about $1,079.

The Visa survey also found that parents are planning to pay for 59% of prom costs, while their teens are covering the remaining 41%. With parents subsidizing this much of the total prom spending, there is little incentive for teens to cut costs, Sillin said.

Visa, which offers a free prom-planning app (Plan'it Prom) , suggests that parents work out a prom budget well in advance to determine what the family can and can't afford. Set limits on parental spending, telling your teen that he or she can spend as much more as they can earn -- but they can't tap your budget to go overboard.

There are lots of ways to save on prom costs without diminishing the event. Dresses can be bought at discount stores, such as Ross, Marshall's, TJ Maxx and H&M often for a fraction of what they cost at other department stores. Arranging swaps between friends can also allow girls to wear a new (to them) gown without buying. Used clothing and consignment stores sometimes also have beautiful gowns at good prices.

Instead of having make-up and hair professionally done, consider hosting a pre-party where girls fix each other up for free. Parents can also meet there and take copious photos with their own cameras or smart phones, which are far cheaper than the pictures sold by the prom's professional photographer.

Limousines? If you can't face the notion of forgoing the costly wheels, at least shop around for the best hourly rates and lowest minimum fees. And share with other couples to divide the cost.

"The prom is an opportunity to teach teens how to budget," adds Sillin. "If they want that sparkling dress, fancy dinner, and limo ride, this is the opportunity to set a budget and save."