The FINANCIAL — Summer may still be in full swing, but American families are already getting ready to “fall” back into the upcoming school year. According to the latest American Express Spending & Saving Tracker, parents expect to spend an average of $1,642 on back-to-school expenses this year, up significantly from $1,239 in 2015.
This coming school year, parents are expected to spend more on musical instruments ($267 vs. $194 in 2015) and mobile devices ($172 vs. $125 in 2015), among other items also seeing a bump in spending:
2016 vs. 2015
Plan to purchase
96% vs. 95%
$138 vs. $111
Clothing & accessories
95% vs. 91%
$293 vs. $269
94% vs. 91%
$145 vs. $120
82% vs. 75%
$126 vs. $106
Technology (computers/laptops, tablets, phones, or other mobile devices)
59% vs. 46%
$505 vs. $466
52% vs. 41%
$172 vs. $125
34% vs. 24%
$267 vs. $194
“When looking at trending data on this topic from the past five years, 2016 is showing the largest year-over-year increase for back-to-school shopping,” said Jed Scala, Senior Vice President, Consumer Lending at American Express. “This may be attributed to an ever-evolving back-to-school shopping list and, perhaps, parents’ ability and willingness to spend more when it comes to education and extracurricular activities.”
As overall back-to-school spend increases, so does the widespread use of gadgets in the classroom. A whopping 92% of parents report that their kids are using tech for learning (vs. 82% in 2015). To accommodate this gradual upswing in usage, six in 10 parents will purchase electronics for the upcoming school year (59%), spending an average of $505 on gadgets. Laptops will top the list of most popular back-to-school tech supplies (28% vs. 22% in 2015), followed by tablets (23% vs. 19% in 2015) and cell phones (19% vs. 14% in 2015).
The use of smartphones for education has steadily increased over the past four years, with 32% of parents agreeing that smartphones are a go-to gadget for learning (vs. 29% in 2015, 24% in 2014 and 19% in 2013). Of those parents purchasing a cell phone for back-to-school season, 73% will purchase a smart phone. However, whether kids are using phones for personal or educational purposes, parents say the average acceptable age for a cell phone remains at 12, consistent over the last three years.
Budgeting 101 & Extracurricular Credit
As back-to-school spending rises, parents are finding it more important to set budgets for certain school-related expenses. For example, 64% of parents are setting a shopping budget for clothes (vs. 59% in 2015). Despite setting these spending limits, 23% of parents say they would still purchase clothing or a tech gadget if it exceeds their budget because it’s an incentive for their kids to do well in school (59%, significantly down from 74%), or it’s an easier trade-off than arguing with their child (19%, significantly up from 3% in 2015).
In addition to setting budgets, 78% of parents are choosing to curb their own spending to afford their kids’ back-to-school expenses (vs. 74% in 2015). Many parents plan to cut down on “extras” including entertainment, such as plays, movies, sports games and concerts (42% vs. 38% in 2015); travel (40% vs. 32% in 2015); and extracurricular activities, such as club memberships and personal hobbies (28% vs. 21% in 2015).
While they may be cutting down on personal extracurriculars, nearly nine-in-ten (87% – on par with 2015) parents say their child will participate in at least one after-school activity. Overall, parents expect to dish out an average total of $409 on these activities per child (vs. $455 last year) with sports being the most popular (59% vs. 60% in 2015), followed by band, choir or music lessons (30% vs. 27% in 2015) and hobby groups (30% vs. 27% in 2015).