Parents using credit cards and BNPL to cover back to school costs

Parents are taking different approaches to managing back-to-school costs, with 22% planning to use a credit card, 16% of parents planning to use Buy Now, Pay Later (BNPL) to cover back-to-school costs, and 19% saying they have cut back on other spending to afford the return to school, new research from Compare the Market has shown.

A further 7% plan to use an overdraft, highlighting the different ways families are managing the financial pressure of back-to-school spending.

The research also showed that 30% of parents have previously gone into debt specifically to cover back-to-school costs and that 29% have run short of money before payday without borrowing.

A further 16% worry about being able to afford the costs every year, whilst 20% expect to spend £300 or more per child.

Meanwhile, 50% say school uniform is one of the hardest back-to-school costs to manage and 37% struggle with the cost of school shoes.

The findings highlight how the return to school can create a concentrated financial pressure point for families. After six weeks of summer spending, parents can face several essential costs once, from uniforms and school shoes to PE kits, bags and stationery, alongside their usual household commitments.

For families with more than one child, the £225 average expected spend can quickly become a larger household expense, with two children costing around £450 at the average rate.

Charlie Evans, money expert at Compare the Market, said “Back-to-school spending can put pressure on household budgets because several essential costs need to be covered within a relatively short period of time. Our research shows that some parents are turning to credit or cutting back on other spending to manage the additional cost, while others are reaching payday with less money than they would normally have.”