When Dallas mom Jan Valecka's twins hit that contentious tween age, the rite of passage she dreaded most was a relatively new one: when to get them cell phones.
"They were starting to see all their friends get smartphones and iPads," says Valecka, a financial planner at her own firm. "They started lobbying hard."
She caved when they started 5th grade and got them basic cell phones. The boy-and-girl twins are now 13 and in 7th grade. Their upgrade to smartphones costs Valecka about $75 a month each.
Valecka is hardly alone in dealing with the emotional and financial consequences of giving kids smartphones. A quarter of U.S. 8-and 9-year-olds now have them, according to the 2015 Parents, Kids & Money survey by Baltimore money managers T. Rowe Price. And a new study from Pew Research Center discovered that only 12% of American teens age 13 to 17 do not have a cell phones of any type.
To make the correct call, though, do the math to be sure you are ready for far-reaching consequences. After all, it's not just a one-time purchase that parents are agreeing to, but a stiff monthly charge that could last for many years to come.
If you get your 12-year-old a plan that costs, say, $50 a month, that will set you back $4,200 though age 18. And that's not even including any ancillary costs like equipment and upgrades, repairs and app purchases. Data overages, especially if your kids are heavy video watchers, could inflict significant extra damage.
Indeed, 23% of households report paying much more for their kids' phone plans than they originally expected, according to a study by the National Consumers League.
That doesn't have to be the case if you are thoughtful about how your decisions will affect household finances. Here are some suggestions:
1. Start with baby steps
A basic cell with phone and texting capability can be very reasonable indeed; Sprint, for instance, offers a WeGo starter phone for only $9.99 a month.
There are also prepaid plans available, with varying restrictions on minutes and data, and low-cost handsets. T-Mobile, for instance, offers a $40-a-month prepaid plan with unlimited talk, text and data on its own network, and 1 GB of nationwide LTE data. With hard limits in place, parents are essentially saving themselves from any unwanted bill surprises.
Consider it something of a trial period: If your kids prove responsible with their new gadgets, and aren't constantly calling or texting their buddies late into the night, then you can talk about graduating to more elaborate phones and plans.
When you are all ready, every major carrier offers a version of a family share plan, like Verizon's More Everything and AT&T's Mobile Share Value. Additional lines cost less money than standalone packages, but contracts are often involved.
At that point the training wheels are off—and if you are sharing your family data package with your teenager, be prepared to blow through some usage limits.
2. Have the money talk
"The question that must always be discussed is, 'Who will pay for what?'" says Mark La Spisa, a planner with Vermillion Financial in South Barrington, Illinois. "It's critical to talk about it in advance of a child receiving their first phone."
For an 8- or 9-year-old, it is unfair to expect anything beyond a token contribution. But teens who have their own income from part-time or summer work can start chipping in to cover part of the bill.
Also consider who the phone is really benefiting. If it is mainly for the parents' peace of mind, that's one thing. But if it is only for their enjoyment, and parents are not deriving any benefit at all, then "then they should be footing the bill," says personal finance expert Gail Vaz-Oxlade, author of Money Rules.
3. Resist the lure of the constant upgrade
For her own kids, Vaz-Oxlade pays the bills, because she wants to get in touch with them. But she draws the line at hopping on the "hamster wheel" of getting them the latest-and-greatest gadgets on the market. That's just throwing away money, in her opinion.
As a result she, her son and her daughter are all still using trusty iPhone 4s they got a few years ago.