38% of Consumers are Cutting Costs to Cover Back-to-School Expenses This Year
- Households expect to spend an average of $864 on back-to-school expenses, and $1,199 on back-to-college purchases.
- A whopping 38% of households are cutting other costs so they can afford back-to-school expenses.
- More than 40% will rely on online shopping and sales to get the most out of their money.
Back-to-school costs are an essential expense for many families.
The scent of freshly sharpened pencils, the store shelves full of backpacks, the sales flyers with the latest in K-12 fashion. Yes, it's back-to-school season, when the young folks migrate from their summer yards to the venerable halls of academia.
For many parents, the start of the school year is a mixed blessing. Sure, they get back to enjoying the pleasures of free babysitting -- er, education. But it also means forking over a small fortune to buy school supplies.
Or, in many cases, a not-so-small fortune. Indeed, the National Retail Federation (NRF) estimates the average American family will spend $864 getting their kids ready for the new school year. That's almost a 10% jump from last year's costs.
For families with teens heading to college, those costs are even higher. Families expect to pay an average of $1,199 on supplies for the upcoming semester.
With most households already reeling from intense inflation, the upcoming school year -- and its associated expenses -- means making some hard choices. And as parents often do, many are choosing to prioritize their children's back-to-school needs over other expenses.
Parents are slashing spending in other areas
Getting hit with a back-to-school bill almost as high as a month of rent isn't easy, especially with the costs of everyday essentials already so high. Families are having to make tough choices to fit in the extra costs. For more than a third of them -- 38%, according to an NRF survey -- that means cutting back in other spending areas.
As you may expect, this is particularly prevalent in lower-income households. About 34% of those with incomes of $50,000 a year or more have found the need to cut back, while nearly half (47%) of households with incomes below $50,000 are cutting back to make room for back-to-school expenses.
More than 40% of parents with school-age children are turning to online shopping for extra savings, as well as spending more time looking for coupons and sales. Additionally, more than a third of shoppers are going with store brands and other generics to save money. Roughly a quarter of families are also going to make due with items left over from last year when possible.
Longer hours and more debt
In addition to cutting costs where they can, many parents are also looking to boost their income to make up for the extra back-to-school costs. Roughly a fifth of survey respondents -- 18% -- say they're working overtime or taking on additional hours to cover school expenses.
Unfortunately, slicing the budget and working longer hours aren't always enough. A large number of folks are turning to various forms of financing. Buy now, pay later programs are being used by 17% of respondents to spread out costs. Meanwhile, 14% plan to open new credit cards to finance purchases, and 12% of folks are borrowing money or going into debt in other ways.
Saving on essential spending
For most families, back-to-school shopping is considered an essential expense. This means doing what they must to make the math work out.
On the plus side, retailers are nearly as invested in the back-to-school season as parents are, and there are a lot of deals to be had if you know where to look. Discount stores often sell a wealth of office and school supplies, and even major department stores offer some quality savings this time of year.
There are also all kinds of deals for college students, with dozens of student discounts available from retailers of all kinds.
Don't forget to check with your credit card issuers, too. Issuer savings portals can house some really great discounts from popular brands. And a good rewards card can help you earn 5% back or more on your purchases. Just be sure to maximize your rewards by using the card with the best rewards rate for each purchase type.
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