News Releases

(KNOXVILLE, Tenn.) – Summer break is drawing to a close for most of the state's students, and their parents are beginning to shop for back-to-school supplies and other expenses associated with school.

How do parents send their young scholars back to school without breaking the family's piggy bank? A University of Tennessee Extension family economist says the key is year-round planning, and now is a great time to start.

"It can be very tempting to put all of these purchases on a credit card if you have not budgeted for back-to-school expenses," said Ann Berry, a family economist with UT Extension. "If the average back-to-school expenses of $3,389 are charged on a credit card and only the minimum monthly payment is made, it can take 39.5 years to pay off, with the added cost of $9,098 in interest payments!"

Berry recommends that parents budget an amount each month to cover the year's estimated school expenses for each child.

According to a study by Visa in 2003, only 37 percent of parents claim to have an itemized back-to-school budget, Berry said. "That means at least 61 percent of parents don't budget for this predictable need."

Berry says parents should begin planning for the year's expenses now. "Tennessee is offering sales tax free days August 4 -6, 2006. For school supplies, clothing and computer needs you can make purchases during these days without having to pay any sales taxes. That can save you several dollars!" The economists says parents can put qualifying items on layaway prior to the tax free shopping days, but you must take the items off layaway during that time period. "You may also put items on layaway during this time period," she said.

A complete list of qualifying items can be found at http://state.tn.us/revenue/salestaxholiday

"Don't forget to budget and plan for clothing and uniform purchases. Doctor and dentist checkups, school fees, club fees, school pictures, etc. are also expenses for which you need to plan for throughout the year," Berry said.

The economist also says that now is a great opportunity to talk with your children about needs versus wants, budgeting and even credit.

Differentiating between "wants" and "needs" is an important skill parents should share with their children, Berry said. "Before heading to the store, go through the school supply list with your children. See if you have usable items left over from last year. Check the advertisements for discount stores, office supply stores, grocery stores and drug stores. Let your children help make the lists and budget a realistic amount to spend for supplies."

"This is a good time to teach money management and consumer skills. Help your children to see that the expensive backpack they want is a 'want,' while one from last year may still work just fine to fill the need," she said.

For more information on family finances, visit the Family and Consumer Sciences website at http://www.utextension.utk.edu/fcs or contact your local county UT Extension office.

###

Contact: Dr. Ann Berry, (865) 974-8745