Back-to-School Countdown Day 2: Build a Budget for Back-to-School

back-to-school budget

Focus on elastic spending items

That per-child spending limit may loom large! Once it's on the table, you need to cut it further, to reflect spending items that are "elastic": where choices can be made.

Non-elastic items, like instrument rentals or book deposits, must be paid in full. Since there's no "wiggle room" with these items, they must come off the top, so the family can focus on those areas where good decisions can lower school spending.

For example, if each child participates in a sport that requires a $25 fee, deduct $25 from the per-child amount you share with the family.

What's left is the sum available for elastic items: clothing, shoes, lunch boxes. These are the areas where the family can decide how much--or how little!--to spend, and where creative solutions can save real money.

Separate wants from needs

Looking at shopping lists with an eye to decision-making, it's important to separate wants from needs. A clothes-horse daughter may want 14 new outfits for school, but her needs are much different! Help children determine which items on their lists are truly needed, and which are only wanted.

One way to motivate children to be frugal and creative with back-to-school spending? Help them satisfy the "needs" first, then allocate any remaining funds for "wants".

For example, a teen son looking for "street cred" will carry last year's backpack without a peep, so long as he can stride onto the playground in name-brand athletic shoes.

Get creative

Finally, explore ways the family can save on back-to-school spending.

Encourage children to check sale flyers and online sources to find the lowest prices on items they want--and shop multiple stores to take advantage of loss leaders and advertised specials.

Start an "equipment swap" with fellow parents to cut the costs of participating in sports.

Check consignment stores for children's clothing in good condition ... for less.

Does your state offer sales tax holidays? Check this link, then plan shopping trips to take advantage of them:

State Sales Tax Holidays

Stay on top of spending

Finally, your back-to-school budget will provide a reality check, should your spending exceed budgeted amounts.

As you shop, keep a running total of the amount spent per category. When that figure starts to approach budget limits, it's a signal to scale back spending and reevaluate decisions.

Accept the guidance your budget will provide. It's better to be in-the-know as you go, than to find an unhappy surprise in September's credit card statement!