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Inflation reached a 40-year high in June, and the light at the end of the tunnel remains out of view. The result is that many everyday goods and services, including back-to-school items like clothing and supplies, have gotten more expensive.
While you may still need to buy these necessities, it's possible to combat rising costs by taking advantage of sales, using coupons and comparing prices before you hit the stores.
How Inflation Is Impacting the Cost of School Supplies
The inflation rate hit 9.1% in June, the highest annual increase in the price of consumer goods and services since 1981. And while that figure decreased to 8.5% in July, inflation is still hitting consumers' wallets hard.
There are many reasons for these price increases, including supply chain issues and computer chip shortages. This means that demand for certain products outpaces the supply, resulting in higher prices.
Fortunately, the cost of back-to-school items has increased at a slower rate than the average of the whole consumer price index (CPI), which tracks a basket of common goods and services that consumers regularly buy. But with other costs going up as well, affording back-to-school expenses can still be challenging.
The Bureau of Labor Statistics tracks the CPI, and based on its analysis of July 2022 data, the cost of clothing (apparel) increased by 5.1% from the previous year. Additionally, educational books and supplies are 3.1% more expensive than in 2021. This means that, if you spent $100 on clothing in 2021, for example, it now will cost you $105.10. While it doesn't seem like much, those costs can add up quickly if you're sending multiple children back to school or purchasing high-ticket items.
5 Ways You Can Save Money on Back-to-School Shopping
If you're worried about the cost of back-to-school shopping, here are some potential ways you can save some money.
1. Compare Prices
Whether you're shopping online or in store, take some extra time to compare prices on some of the items you're planning to purchase. This may involve searching online at other retailers while standing in the aisle or visiting multiple stores.
You may also consider comparing prices between different brands, opting for brands that may not have the same name recognition but still provide good value.
2. Use Coupons
Check with your favorite retailers to see if coupons are available for some of the items you're planning to buy. You can also search online for coupon databases, which can contain thousands of coupons from different retailers and manufacturers that you can use to save some money.
The couponing process can take some time, especially if you're new to the practice. Using store-specific apps can make the process easier, as you may be able to apply coupons automatically to your transactions. But the little savings you earn with each one can add up quickly.
3. Keep Your Eyes Peeled for Sales
Many retailers launch back-to-school sales that you can take advantage of. But continue to compare prices to make sure that the sales a retailer is offering are actually sales and not just discounts off unrealistic prices.
4. Take Advantage of Tax Holidays
Several states have tax holidays, during which you can enjoy no sales tax or a discounted tax rate on certain items up to a maximum set by state law. Depending on where you live and when you start shopping, you may be able to save on clothing, footwear, school supplies, computers and more.
The Federation of Tax Administrators provides a list of states that offer these holidays, along with when they occur each year, which items are included and the cap on spending.
5. Use Cash Back Websites
Cash back apps and websites like Rakuten, Topcashback and RebatesMe offer cash back on both online and in-store purchases with select retailers. To take advantage of these opportunities, visit the website and search for the retailer you want to shop with.
You'll be able to see if that retailer participates and what the cash back rate is—note that some may offer multiple rates for different item categories.
If you're shopping online, click through to the retailer's website and complete your shopping session. The cash back website uses cookies to track your purchase and gives you the rewards after you complete your purchase, though there's typically a waiting period.
For cash back in store, link your debit or credit card to an offer with the retailer of your choice, then make your purchase as you usually would.
Try to Avoid Borrowing for Back-to-School Costs
While it may be unavoidable for some, try to avoid borrowing money to cover your back-to-school shopping. This includes using a credit card if you think you'll need to carry the balance instead of paying it in full at the end of the month.
If you can't afford your back-to-school expenses, you may consider buy now, pay later services as a way to spread out your payments without incurring interest charges or fees. If your credit is in good shape, you may also consider a 0% introductory APR credit card, which can give you even more time to pay back the debt interest-free.
If your credit score isn't in great shape, you can monitor your credit for free with Experian and identify areas you can improve so you have more options in the future.