Cost of children’s birthday parties creates pain point for parents

Children’s birthday parties have become expensive and some parents are using peer pressure when it comes to paying for them.

Parents taking their children to birthday parties are increasingly receiving a nasty financial surprise – being asked to pay for their child’s attendance, and sometimes their own.

This user-pays trend has grown as the cost of living surges, financial specialists say, but they believe children's parties should be paid for by the hosts.

Sort My Money founder David Rankin says paying-guest parties are “definitely happening in the economic squeeze we have all been experiencing in the past few months as a result of higher interest rates”.

“Now that people are doing it tough, they are looking for ways to cut costs,” he says.

But this should not involve making other people pay for your child’s party, Rankin says.

“My personal view is that you are the host, and the host pays,” he says.

“If you are going to do user-pays, telegraph to the parents ahead of time that these are the rules of engagement.

Children’s parties have become extravagant, but parents are being urged not to compete.

“It’s only fair to let somebody know. Up to now, as a society our rules have been that the hosts pay, not the guests pay.”

Rankin says hitting parents with the surprise cost on the day of the party is a trap and “blatant peer pressure, because they know there’s no way someone will pull out at the last minute in front of the amusement park or adventure park”.

Parents who are struggling financially should speak with their children to explain reasons why parties may be scaled back, Rankin says, rather than jeopardise family finances.

“It’s important to show children the value of generosity,” he says.

“If we are not careful, everything will become a business transaction and nothing will be coming from the heart.”

MBA Financial Strategists director Darren James says children’s parties often cost well over $1000.

“For a five-year-old that seems pretty excessive, but it seems to be what it is,” he says.

“In some year levels you almost invite the whole class.”

Many parents are trying to equal or better other children's’ parties and the costs spiral, James says.

“It’s a hiding to nothing. It should not be about not trying to complete but keeping a lid on it.

“Now that the cost of living is going up there’s pressures on all sorts of things.”

James says he prefers that guests do not pay at parties, and says parents who want to charge can consider insisting the guests don’t give presents.

“No gift – that’s the path to go down,” he says.