As the summer winds down and the school bells start to ring, parents and children alike prepare for the upcoming academic year. However, amidst the hustle and bustle of shopping for school supplies and new clothing, it’s easy to forget about the financial implications of going back to school. This article aims to provide essential tips on managing finances for both parents and children during this period.

For Parents

Creating a Budget

• Start by listing down all the potential expenses related to going back to school. This includes school supplies, clothing, transportation, meals, and after-school activities.
• Once you have a list, allocate a specific amount of money for each category. Try to stick to this budget as much as possible. UCCU offers tools and services that can help you with smart budgeting or savings goals.
• Remember, it’s always a good idea to have a contingency fund for unexpected expenses.

Saving on Supplies

• Before you go shopping, take inventory of what you already have at home. Often, many supplies from the previous year are still usable like old notebooks or writing utensils.
• Consider buying in bulk. Items like pencils, pens, and notebooks are often cheaper when bought in larger quantities.
• Look for sales and discounts. Many stores offer back-to-school sales, so take advantage of these opportunities to save money.

For Children

Understanding the Value of Money

• Introduce the concept of money and its value at a young age. This could involve teaching them about earning, saving, and spending. UCCU recently released our Learn & Earn program designed to break down financial topics into fun, bite-sized games for every member of your family. The more you play, the more you learn, and the more you learn, the more you earn.
• Encourage them to save their allowance for things they want, like a new toy or a book. This will help them understand the concept of delayed gratification.
• Use real-life situations, like shopping for school supplies, to teach them about budgeting and making smart financial decisions.

Encouraging Financial Responsibility

• Give them a small allowance and let them manage it. This will give them a sense of responsibility and allow them to learn from trial and error as small items of responsibility are handed over to them.
• Involve them in family financial discussions. This can help them understand the family’s financial situation and the importance of making wise financial decisions.
• Encourage them to earn their own money. This could be through chores, a part-time job, or even a small business. This will not only teach them the value of hard work but also give them a sense of achievement.

The Need for Financial Education

Importance in Personal Life

• Budgeting: Understanding how to budget is a fundamental aspect of financial education. It helps individuals manage their income and expenses effectively, preventing them from living paycheck to paycheck.
• Debt Management: Financial education teaches individuals about the implications of borrowing and the importance of managing debt effectively. It helps them understand the cost of debt, including interest rates and fees, and how to avoid falling into a debt trap. Understanding Credit Card Debt will help you immediately and have lasting impacts into the future.
• Investment: Investing is a powerful tool for wealth creation. Financial education provides the knowledge required to understand different investment options, assess their risks and returns, and make informed investment decisions.
• Savings: Financial education emphasizes the importance of saving and how it can help achieve financial goals and provide a safety net in times of emergency. UCCU offers multiple savings options including Savings Certificates and Money Market Accounts.

Learn and Earn

Learn & Earn pays your entire family to become smart with money! Break down financial topics into fun, bite-sized games for every member of your family. Every time someone in your family completes one, they earn points that they can redeem for gift cards to stores like Amazon, Apple, Nike, and more! 

This new UCCU financial tool has over 900 modules you can complete. They range from topics around budgeting, saving, spending, loans, insurance, education and careers, investment and retirement, entrepreneurship and so much more! The topics you are presented are relevant to to your age group.

In conclusion, going back to school is not just about getting new school supplies and catching up with friends. It’s also an excellent opportunity for parents and children to learn about managing finances. By following these tips, you can ensure that you are financially prepared for the new academic year.

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