Back-to-school season is around the corner, and so is the dreaded long list of school supplies, which differs by grade, school and subject. According to the National Retail Federation, families with children in elementary through high school plan to spend an average of $687.72 per child on back-to-school supplies, for a total of $29.5 billion, and this number is expected to rise.
But parents don’t have to take out a loan or second mortgage to fund their back to school shopping.
We recently sat down with Rachel Barzilay, CAP®, CFP®, CRPC®, Managing Director, Wealth Management Advisor and Senior Portfolio Manager with Merrill Lynch Wealth Management in Boca Raton, who provided us with some tips on budgeting for back-to-school season.
Why is back to school shopping so expensive?
The little things really add up. Parents are tasked with not just buying supplies but also apparel or uniforms, shoes, and electronics. Parents are also expected to buy specific brands of supplies. While this seems tedious, it is meant to standardize all the equipment to eliminate frustrations and classroom downtime. Setting the same brand for everyone is also meant to reduce the socioeconomic differences between pupils and reduce bullying.
Additional funds are also needed for extracurricular activities such as sports. The cost of enrollment, uniforms and sports accessories can add up quickly. Some parents also must budget for tuition if their child attends private school.
What are some creative ways to reduce costs?
One way is to start shopping early. If you can, space out the expenses so that you have time to recuperate your savings in between shopping trips. Also take advantage of the tax-free weekend (Aug. 3–5) and other special deals throughout the summer.
It may be easier to focus on the bigger ticket items first and work your way down the list to the smaller supplies. Electronic sales occur throughout the summer, so be mindful of the sales at certain stores.
How do you get your kids involved?
Your kids can influence your buying decisions when it comes to supply shopping, from favorite colors and designs to brands and accessories. According to the National Retail Federation, 65 percent of back-to-school shoppers say half or more of their purchases are a direct result of their children’s influence.
Involving your kids in real world examples is an excellent way to teach your children financial independence and responsibility. Financial responsibility is not age-specific. Even if your kids are very young, you can speak with them about establishing a budget, the importance of saving and working to earn a little extra money. Families can take advantage of online and mobile banking apps, such as Zelle, which provide an easy way to split the costs of supplies while teaching your child about budgeting. As they grow older, you can discuss topics such as planning for college, taxes, and Social Security. All of these are learning opportunities that can help them later in life, especially when they are young adults.
Finally, it is important to remember that most of the items on your back-to-school shopping lists are a lifestyle expense. You should avoid running up debt to fund seasonal spending – especially items that are more wants than needs. To that same point, do not lose sight of long-term goals; make sure you stay on track with contributing to your retirement plans (401K, 403 B etc.) and education funds (529’s).
As a parent, it is understandable to want to give your kids everything; just be sure you are being thoughtful about the expenses involved, because there are plenty of ways to plan and save.