Back-To-School Credit and Budget Tips

Summer is coming to a close and back-to-school season is in full swing, which prompted me to wonder just how much is reasonable to spend on it. The answer is much higher than I thought.

As the parent of a very active 14-year-old boy, I’m used to the endless stream of costs that flood in as the school year gets closer, but I was still shocked to see exactly what I’d shell out before school even started. The Huntington Backpack Index puts back-to-school costs at $547 for elementary, $724 for middle school, and $1,117 for high school.

Given the cost, how can you protect your budget and credit from the back-to-school bogey?  Here are 5 basic tips:

1. Set a budget. Set a budget based on what your broader financial situation can support, track your spending, and don’t go over. If you can’t afford it, don’t buy it. Set aside cash and count down as you spend or save your receipts and count up. Either way, keep an eye on what remains to stay within budget.
2. Reuse hand-me-downs. Reuse and recycle. Reuse clothes, musical instruments, art supplies, backpacks, and sports equipment if possible.
3. Reduce costs by buying second-hand where possible. Musical instruments and sporting gear are great candidates.
4. Economize. Buy private label basics wherever possible. Avoid expensive brand-name clothing and find unbranded basics. Wearing an “unbranded” basic shirt or pants can be much better than a branded product that isn’t acknowledged as cool or fashionable. 
5. Protect your credit. Don’t let back-to-school expenses drag you back financially or hurt your credit. 
   1. Pay with cash instead of paying with credit. Studies show that you spend less when paying with cash or on your checking debit card.
   2. Pay off any credit card bills in full so that you don’t increase your credit utilization ratio which accounts for 30% of your score. 

With a bit of planning and a lot of vigilance, it is possible to come through the back-to-school season smelling better than a used gym shirt. That may not be as good as smelling like roses, but it’s not too bad.