US News Survey: COVID-19 Spends School-to-Back
The coronavirus epidemic is hurting domestic finances such that distance education is demanding more of them. As the shoes and lunchboxes replace the big-ticket electronics and accessories on the back-to-school shopping list, several parents surveyed in August by US News said they paid for these items Has opted not to use a credit card.
On one hand, these parents of grade school and college students are trying to avoid debt. Opportunity costs, on the other hand, are: You give rewards, offer a 0% annual percentage rate and have opportunities to teach children about credit.
Here the survey highlights:
- Most students are starting the school year at least partially from traditional classrooms, whether they are doing virtual, hybrid or home schooling.
- Most parents are not using credit cards for back-to-school expenses this year.
- COVID-19 Economic pressure has made it difficult for some families to reduce school expenses.
- Many families are spending less on traditional back-to-school expenses, but more than a quarter are buying new technology for this school year.
- Most parents stated that they do not feel that high schools are sufficient to teach personal finance to children.
- Parents are typically teaching their children about savings and budgeting, but may fall short of investing and using credit – including the use of hands-on credit cards.
Only 31% of parents said that their children are going to school completely individually.
About 61% of parents stated that they did not use a credit card for back-to-school purchases this year, but about 5% said they used the card because they could not otherwise afford the expense.
COVID-19 economic pressures have made it difficult for 17% of respondents to pay for back-to-school items.
Almost half of parents are spending less on traditional back-to-school expenses than in other years.
Most parents who used a credit card for back-to-school expenses said they chose a rewards card.
About 26% of the families purchased technology for this school year.
Only 14% of the respondents said that their children have their own credit cards or are authorized users on the parents’ cards.
Many parents indicated that there is room for improvement in personal finance education, as 83% said that high schools are not enough to teach children about money.
When it comes to educating their children about the concepts of money, more parents teach them about investing in savings and credit, and how to use credit.
How can a credit card help with back-to-school expenses?
Shopping for a school-to-back season with a credit card has its risks. You can take advantage of rewards, introductory APRs, sign-up bonuses, and security, which can add up to big savings.
Cards can be helpful for back-to-school shopping with these features:
Award. Never mind if you are spending money on school supplies, you may get something in return. Together Gives credit card, When you use the card to make a purchase, you can earn points, miles, or cash.
You can redeem your cash back as a Statement credit To make up for your purchases, or save your rewards and use them for gift cards, travel discounts and other options.
Sign-up bonus. With a credit card Sign-up bonus If you are receiving a cash back bonus, it can help to reduce back-to-school costs in particular. Cards with sign-up bonuses allow new card holders to earn additional points, miles, or cash back rewards by spending a minimum of a few months, usually the first few months.
The real value of credit card rewards often results in sign-up bonuses: rewards may be lower than they are for everyday purchases.
Dan Miller, a father of six, says, “Whenever you have a big expense, or a series of small expenses that turn into a big expense overall, take advantage of the sign-up bonus Consider opening a new card for. And the founder of Points of a Crew, a blog that helps families – especially large families – travel cheaply.
0% introductory APRs. This type of card gives you time to pay for big-ticket back-to-school items, such as computers and desks, without interest – unless you pay your balance before the 0% rate expires.
If you do not, you may end up with a larger bill than you expected. A card that typically charges 15% APR means that you will pay a 15% premium on your balance.
“If you’re thinking about APR, you’re thinking about credit cards the wrong way,” says Grant Sabatier, creator of personal finance website Millennial Money. “APR is a percentage on the price of anything you buy.”
Price protection. Credit card with price protection If you’re worried about back-to-school inflation, you can help: what you thought was the best price on an item, only to find it on sale a week later. If you used a credit card with price protection, you can get a refund for the difference if you find the same item for a lower price within a certain time frame, usually 60 to 90 days.
Purchase Protection. If your child loses or harms an expensive laptop, tablet or smartphone, Purchase protection You can be reimbursed for the cost of the item within a certain coverage period.
extended warranty. Another good feature for big-ticket items, Extended warranty coverage Extends your original manufacturer’s warranty. If you use a credit card that offers this coverage for free, you can save money by reducing the retailer’s extended warranty to purchase.
What type of credit card is good for back-to-school spending?
What kind of credit card is good for back-to-school?
Generally, a flat rate Cash back credit card The most flexible card will be for back-to-school shopping. Flat-rate cash back cards earn the same rate of cash back on every card purchase you make.
This type of card can allow you to earn not only a sign-up bonus, but also rewards with many retailers. If your expenses are spread to big box retailers, online merchants and grocery stores, then the cash back card can give you a good comeback.
The use of a single cash back card keeps the school rewards simple, along with a good earning rate. You do not have to take care of spending categories.
A different card may be a better option depending on shopping or redeeming rewards plans.
You might want to choose one Travel credit card To take away the rewards from back-to-school shopping for the upcoming trip.
“Awards come in all tastes,” Sabatier says. “Often, you can get a higher redemption value for a trip than a cash back.”
But travel credit cards sometimes earn the most rewards on travel purchases, meaning you may not get much for back-to-school spending.
Store credit card There is another option, but they usually do not provide the best value compared to cash back cards or other options. It can be worthwhile comparing store cards with cash back cards to see which one is right for the purchase you are making. A store card, for example, may offer a one-time savings pass that can rival the cash-back card sign-up bonus.
Store cards are almost always a terrible idea, although outliers exist. Look and see the fine print, especially APRs and fees, before closing offers at store checkout counters.
However, do not ignore Grocery credit card, Which can provide up to 6% cash on purchases such as backpacks, school supplies, lunchboxes and meals for school lunches.
Some of these cards offer bonus reward categories, including many items on the back-to-school shopping list – even lunch staples. For example, with Amazon Prime Members Amazon Rewards Visa Signature Card Amazon can earn 5% cash on school supplies and 5% back in the Whole Foods market.
Once you choose the right card for back-to-school shopping, these tips can help you manage your expenses and save money:
sticking to a budget. Even if you have a seemingly endless credit limit, it does not mean that you should use it. Make a budget for back-to-school expenses and don’t deviate from it.
Try not to lure more than your budget because you know that the purchase will be approved.
Set a price alert. Staying on top of prices for major expenses such as electronics can result in savings.
Do your best to buy late summer or early fall for back-to-school deals on technology. College students may qualify for a year-round exemption.
If your credit card has price protection, you can get a price match for an item if the price drops after you buy it.
Use your rewards. If you have credit card rewards, consider cashing them for back-to-school expenses. Some issuers allow you to encash rewards for discounted gift cards, which offer a good value and help you save back-to-school shopping.
If you are hoping to use a credit to stretch your budget and spend more than you can afford, this is not a good option for back-to-school shopping. Credit cards are not the only way to pay these expenses: Cash, debit cards and free or discounted school supply programs are other options.
At the same time, credit cards with rewards and consumer protection may offer an edge over some of these methods. If you can use the card responsibly, it can pay.
“If you have the financial discipline and the means to pay your credit card full time, I think it makes sense to put everything on credit cards – back-to-school expenses included,” Says Miller.