Spring into the new school year: Planning for the rising costs of education

Congratulations, you’ve made it through the first week of the 2023 school year! As your kids spring back into the rhythm of classes and life inches back to its usual routine post-summer vacation, the start of the school year is the time to get your financial situation in check.

Whether your child is gearing up for first grade or postsecondary school, there’s something else gearing up too: the costs of going back to school. In Canada, more families than ever are feeling the pinch due to inflation, rising interest rates, and the overall cost of living adding an extra layer of financial strain — especially for families with children.

Fortunately, managing family finances during this time doesn’t need to feel stressful, and with the proper planning, you can set your family up for success. Instead of starting the school year in a financial crunch, Spring Financial has put together some ways you can ace your family budget planning.

Taking stock of the September spend

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Financing a full set of school supplies has never been cheap, but parents who haven’t purchased supplies since last fall will likely encounter more sticker shock than usual this year. Like most consumer goods in Canada, school supplies like notebooks, pens, and pencils have not been immune to the high inflation we’ve experienced over the last year.

Before your young scholars hand you their lengthy list of school supplies, take a moment to balance their enthusiasm with the reality of your budget. Do they really need a new backpack this year, or will their previous one do the job?

The cost of school textbooks and supplies rose 2.8% over the past year, so identifying ways you can reduce your back-to-school expenses is a must to ensure you are staying within budget.

But the rising costs don’t stop at school supplies. Extracurricular activities like sports, music lessons, clubs, and even shopping for new clothes can quickly add up, further putting a strain on family finances.

Budget basics: The value in having a plan

While priorities for the school year might focus on shopping, the first and most important thing to do is to create a strong budget. Weigh the have-to-haves against the nice-to-haves and determine what is realistic for your family.

Engage your children in conversations about budgeting from a young age, turning it into a valuable teaching moment. Use this opportunity to increase their financial literacy and teach them the importance of responsible spending, whether it’s on new purchases, piano lessons, or sports teams.

To avoid a sudden spike in expenses, consider spreading school-related costs throughout the year. Look for sales throughout the year and capitalize on opportunities to save on costs instead of waiting until the start of the school year to purchase supplies.

Additionally, if there is a financing option for enrolling in extracurricular activities instead of paying a lump sum, opt to finance so that you can balance payments throughout the calendar year.

In addition to budgeting and planning as a family, exploring alternative financing options is something many families are starting to consider. For larger items, buy now and pay later options seem like an appealing option.

However, purchasers should be wary of any interest rates attached to those “deals.” While it may be a quick fix for the time being, you could end up paying significantly more in the long run.

The importance of proper financial planning

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Even if you’ve created a plan and are staying within budget, there may be situations that come up where you need quick access to cash. Credit cards are your first line of defence for covering costs in the short term, but interest rates ranging from 19-21% can leave you in a tricky financial situation if you’re not able to pay back the balance promptly, and it can harm your credit in the long run as well.

On the other hand, payday loans can negatively impact your credit score and also come with hefty interest rates. Spring Financial is a middle ground where Canadians can access cash quickly at a lower rate.

With personal loans of up to $35,000 and interest rates starting as low as 9.99%*, you can get access to funds e-transferred as soon as the same day to ensure you can make those deadlines for soccer lessons or buy textbooks before lectures begin. By completing an application on Spring Financial’s website, our team will find the best-suited solution for you to make sure you get the cash you need when you need it.

Focus on the excitement of the season, not the spend

Back-to-school season is an exciting and transformative time of year. It’s a time when parents eagerly support their children through the transition to a new school year, ensuring they have everything they need for success.

We understand that financial planning can sometimes add stress to this already busy period. That’s why it’s important to be aware of all the options available so you can budget effectively and explore alternative financing options. By taking these proactive steps, families can truly set themselves up for success and provide their children with the best educational experience possible.

For more detailed information and helpful resources, we encourage you to visit our website at www.springfinancial.com.

* Spring Financial Inc. provides loans up to $35,000 with interest rates ranging from 9.99% to 46.99%, and terms from 6 to 60 months. APRs on such loans range between 10.8% to 46.99%. Your actual rate will depend on a variety of factors such as your credit score and the loan amount.