Parents Drop Lavish Amounts on Over-the-Top Kids' Birthday Bashes

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"You may not be able to afford that new luxury car or buy the home of your dreams," Waldburger said. "But you can drop a few thousand dollars on your child's birthday party and make a pretty big impression on 150 of your neighbors."

Waldburger also said elaborate and expensive parties can give parents a sense of validation.

"This unforgettable experience gives parents a lot of validation and makes them feel like they are doing a good job," she said.

Back at Gracie's royal 6th birthday party, mom and dad planned a special surprise for the grand finale -- a new car.

"Mom, I don't know how to drive," Gracie said after her present was unwrapped.

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