Back-to-school shopping can be a stressful experience for parents whose budgets are already stretched thin. But according to NBC senior business correspondent Stephanie Ruhle, with a little planning, the start of the school year can be a great opportunity to teach kids about managing money, while saving a few bucks in the process.
Saving on school supplies
Many families have already been back to school for a few weeks while others are just getting ready to kick off a new school year. If you're heading out to do some back to school shopping, make it a teachable experience, says Ruhle.
"If you are dealing with any late trips to the office supply store, it can be a good opportunity to teach kids about smart shopping," she said. "If you are able to buy in bulk, show them how to read shelf labels for unit prices and compare what is a better value." If you're sticking to a tight budget, show kids how to stick to the list or why forgoing something like a new backpack this year can mean a different, more important purchase later on.
Related
Ruhle said that one thing she likes to do is to give her kids a couple of bucks to spend at the dollar store. "It's a good way to show them that delayed gratification can lead to a bigger payoff, or if they want to get what they want in the moment, teach them that, too," she said.
And while you don't need to share all the details on your finances with your kids, you can show them how to make good financial decisions and make a budget, which will set them up for success.
As for saving cash on back to school shopping Ruhle suggests using couponing or a cashback app such as Rakuten or Ibotta for more deals.
Looking ahead to college tuition
While you're at it, it's never too early to start thinking about planning for college. Even if your kids are little, now's the time to think about opening up a college savings account for them, says Ruhle. "A 529 is one kind of savings account, the rules can differ state by state but if you use the money for education you can get some serious tax breaks," she said.
Even if you're not in the position to make regular contributions to a college fund right now, don't discard the idea. "That's a great place to say, 'Hey grandma and grandpa, we don't need another toy for our kids' birthdays but we are saving for their futures and here's how to contribute,'" suggested Ruhle.
But before you open a savings account, check the rules in your state as there is some potential that it may impact your student's financial aid, especially if someone other than the student or custodial parent holds the account, said Ruhle.
Related
One way to get older kids involved in saving for their own college is to remind them that grades can have a big impact on financial awards and merit scholarships. "You don't want to stress your kids out too much but a gentle reminder that these things do matter can help avoid any regrets come application time," said Ruhle.
The best course of action is to be open with your kids from the start about what, if anything, you can contribute to paying for college. Start to educate yourself on the financial lingo now and help kids understand what it means to take on debt.
"Don't hide from it, educate yourself," said Ruhle. "There are a lot of resources out there to help both parents and students on how to keep things affordable."
The FAFSA (Free Application for Federal Student Aid) is one place to start and there are scholarship finder websites too, plus plenty of books, podcasts and others sites to check out if you're feeling overwhelmed.
A little planning goes a long way
Financial planning may sound intimidating, but it can be a huge stress management tool for parents, says Ruhle. "Knowledge is power and both kids and adults like to know what is going on so they can be on the same page," she said.
"I know you don't like to plan, the same way you don't like to exercise or track your spending, but you need to do it," continued Ruhle. "It can help save you time and money in the long run."
And though it's easier said than done, there are tools available to help. "Sort out with your family whether hard copies or digital tools are better to work with," she said. "Take a calendar for example — if you have younger children, perhaps a bulletin board is easier than a shared calendar app for teens." If you can make your schedule clear and have easy reminders, you can avoid fees for things such as missed doctors appointments or late registrations.
"Another small way to start is your grocery list and meal plan," said Ruhle. "Going to the store with a plan and a list will help save you money and reduce food waste as well as save you from the game time question of 'What's for dinner?'"
Related
Start with small goals
Even if you're not a natural planner, it is a skill you can build.
"Like any habit, it will take some time to form and get used to," said Ruhle. Get the whole family involved by choosing a reward you can all share if you stick to your grocery list and get your kids to their after school activities on time for the month, she suggested.
"Start with small, manageable goals," she said. "Think about it like exercise. If you are really out of shape, do you immediately go and run a marathon? Of course not. You take it mile by mile and that works here too."
Get started now by planning just one or two dinners for the week, updating your family calendar for a few weeks or just by putting your budget into a Google sheet and then adding more things in over time. The results will be amazing and are definitely worth the effort!
For more smart money tips visit On the Money TODAY.
Related: