Backpacks, new shoes, clothes, supplies – when it’s time to send the kids back to school, the costs add up quickly. Supplies alone can easily run $100, and clothing a few hundred more.
Personal finance tips for the back to school season.
Here are some practical credit card tips that are particularly relevant during back-to-school shopping season, when you may be tempted to fund school-related expenses with your credit card.
Plan Ahead
Sometimes an expense is a little too high for you to feel comfortable dipping in to your cash reserves to cover it. But it may still not be right for credit. School supplies can be a good example. You may balk at a few hundred dollars cash, but you know deep down that you shouldn’t use credit to buy something that’s consumed as quickly as notebooks, pencils and school clothes.
There’s a third alternative: plan ahead and start setting cash aside a few months ahead to cover the expense when it arrives. School shopping is a great opportunity to put this principle into practice. You know back-to-school season is coming every year, and you can estimate pretty well how much you’ll need to spend. So set cash aside in a separate account and you won’t have to dip into your cash reserves or use your credit cards when the time comes.
Streamline
No one likes to think their budgeting efforts will mean sending their kids off to school with anything less than the latest, hottest clothes, shoes and accessories. But teaching kids to streamline, and separate wants from needs, is an important life lesson. They’ll learn an important piece of advice about credit card use: spend on what you really need, not just what you want.
Look over last year’s supplies and clothes. Is anything reusable? There probably is plenty that can be worn or used again. Make hard decisions about this year’s must-buy list. Does your son really need that pricey backpack? Or could he get by just as well with one from the local discount store? Will your daughter’s social life really be shipwrecked if she doesn’t have a particular brand of designer jeans? Or can she dress up her old pair with some styling accessories?
Reduce Other Debt
Despite your best efforts, you may find yourself in the position of having to use your credit card to fund some emergency expenses – like a new laptop for your high school teen if hers dies just before the term starts. You can prepare yourself to better manage those monetary emergencies if you pay down other debt, including credit card debt, as much as possible.
Following basic credit card tips, such as paying off high interest cards first and avoiding new debt, can leave you better prepared in case of emergency.