Shoppers experiencing reduced financial strain when gearing up for the new scholastic term this season
In a recent survey by Bankrate, it has been revealed that the combined effects of wage growth outpacing inflation and limited tariff impact have eased the financial strain on families during the back-to-school shopping season. This has led to a significant shift in spending habits, with 30% of shoppers reporting changes in their shopping behaviour, down from 41% at the peak of pandemic-era inflation in 2022.
One key factor shaping these changes is wage growth. Over the past two and a half years, wages have risen faster than inflation, enabling many families to better cope with higher prices. This financial relief has reduced the budgetary pressure felt during the back-to-school shopping season.
The impact of tariffs, initially feared to cause substantial price spikes and supply shortages, has not been as severe as expected. While some products exposed to tariffs have shown notable price rises, the overall effect has been described as "the bark worse than the bite." However, recent inflation data suggests that tariffs may start pushing prices up further, particularly on import-heavy items like furniture and toys, which could influence future spending.
Despite these improvements, consumers remain conscious of prices, continuing to employ money-saving strategies such as budgeting and price comparison. Though fewer families feel the budget strain (20%, down 11 percentage points from previous years), some still adjust by choosing cheaper brands, seeking deals, and purchasing fewer school supplies.
In summary, wage growth outpacing inflation has helped alleviate the back-to-school price pressure on families, while tariff effects have so far been less severe than feared but remain a potential factor in future price changes. This has led to fewer families needing to significantly cut back or switch to cheaper alternatives compared to previous years.
Shopping early is also recommended to help families spread out their cash flow. According to the National Retail Federation, half of back-to-school shoppers started earlier this year out of concern that prices will rise due to tariffs. This trend continues, with two-thirds of families starting their shopping by early July, up from 55% a year ago.
Back-to-school shopping unofficially kicks off around retailer events in early July, such as Prime Day, Walmart Deals, and Target Circle Week. Despite the financial relief, most families (over 80%) still have at least half of their back-to-school purchases left to complete.
It's important to note that the concept of making trade-offs in shopping is emphasized as a valuable lesson for children. If a family splurges in one area, they should consider cutting back in another to maintain their budget. Additionally, scouring the house for reusable items before buying new school supplies is a practical and sustainable approach.
Families can also stack discounts by combining store promos with rewards from credit cards and extra cash back from online shopping portals. Some states even offer sales tax holidays for back-to-school shopping.
In conclusion, the 2025 back-to-school shopping season shows a promising trend of easing financial strain on families, thanks to wage growth outpacing inflation and moderate tariff impact. Shoppers are encouraged to make informed decisions, plan ahead, and take advantage of savings opportunities to ensure a smooth and cost-effective back-to-school experience.
- The current financial situation, marked by wage growth outpacing inflation, has been beneficial for personal-finance management, enabling families to cope better with higher prices during the back-to-school shopping season.
- In light of the upcoming business expenses associated with back-to-school shopping, families are employing strategic approaches such as budgeting, price comparison, and discount stacking to manage their personal-finance and ensure a cost-effective shopping experience.
