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How to Save on Back-to-School Shopping

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Parents often revel in the calm and quiet that comes when kids head back to school, but they aren’t likely to enjoy the excess spending that also accompanies the back-to-school season. According to the National Retail Federation, parents will set a record in 2019, spending an average of $696.70 per household on children in elementary school through high school.

 

“It was interesting to see the across-the-board increases in spending levels,” said Mark Mathews, vice president for research development and industry analysis with the NRF. “Elevated levels of consumer sentiment, healthy household balance sheets, low inflation and recent wage gains all seem to be contributing to a confident consumer who is willing to spend money on back-to-school supplies.”

If you’re planning a trip to the store before classes start, there are a few ways to curb the spending and save some bucks.

Plan ahead

No parent should set foot out the door for back-to-school shopping without first taking stock of what they already have. Plenty of old supplies from previous years might still be usable, especially arts and crafts items like crayons, pencils and pens, as well as more expensive things like backpacks, lunch boxes and calculators.

Crossing a few items off your list is a good first step when it comes to saving, but learning how to budget is also important. It’s tempting to run down the back-to-school aisle and grab every colorful notebook and snazzy pencil case in sight, but it doesn’t make a lot of financial sense. Create a realistic budget based on the items you actually need, and try your best to stick to it. If possible, do most of your shopping online, since it’s easier to keep a running tally of how much you’re spending as you shop.

Be smart about sales

Although you’re bound to run into many back-to-school sales this time of year, you don’t need to buy 12 notebooks just because they’re cheaper right now. In fact, you shouldn’t assume the sales price is the best price at all, said consumer savings expert Andrea Woroch. Instead, always comparison shop.

“Run a quick Google search online or on your phone to see if another store is selling the same or a similar item for less,” she said. “Most big box stores will price match, so you won’t even have to drive to another store to get the better deal.” For example, Target,Staples and Walmart all have price matching policies.

Clip coupons and shop discount stores

Coupons have definitely made a digital comeback, with countless apps and websites dedicated to listing all your options in one place. “Spending a few minutes looking for coupons can help you get a better discount,” Woroch said. “Use apps like CouponSherpa, for instance. Or, use the Honey browser tool, which automatically searches and applies relevant coupons to your online order.”

Many stores also offer discounts to valued customers who sign up for their rewards program, like Walgreens and CVS, while craft stores like Michaels regularly offer discounts. Don’t knock purchasing basics like paper and writing supplies from the Dollar Tree, either — you might be surprised by what you find, and those types of items are often the same quality wherever you buy them.

Tax advantage of tax-free holidays

On select dates throughout the year, different states offer state sales tax holidays, or days where you can purchase items without having to pay sales tax on them. You can find a full list of the 2019 state sales tax holidays here, but some upcoming ones include:

  • August 18-24: Connecticut, clothing and footwear
  • August 17-18: Massachusetts, specific items costing less than $2,500 per item

Split bulk purchases

You can usually save money by buying certain items — like construction paper, pens, pencils and folders — in bulk, but you can save even more by splitting those bulk items with other families. Not only is this a great way to share savings, Woroch said, but you can earn rewards faster by charging everything on your card and then having the families pay you back.

Redeem your rewards

If you have a cash back credit card, now’s the time to use it. “Most credit cards give you the best redemption value when you opt for statement credit or have the cash rewards deposited into your bank,” Woroch said. “You can set this money aside for back-to-school shopping.”

Alternatively, Woroch suggested checking to see if your particular card allows you to redeem points for gift cards to retailers where you plan to shop.

Use discounted gift cards

Besides redeeming credit card points for retailer gift cards, you can also scour the web for cheap gift cards online. Planning a trip to Target? Scan websites like Raise,Cardpool and CardCash first. These sites buy and sell unused gift cards at a discount, meaning you can save on purchases you were planning to make anyway.

Consider having your kids contribute

Depending on your child’s age, back-to-school shopping might be the perfect time to start having them contribute to their own goods, especially if they earn an allowance or have a job. Talking to your kids about money at a young age — whether about budgeting, saving or spending — will help them develop solid money habits that will pay off in the future.

Parents already seem to be catching on to this idea. “It was surprising to see how much of their own money kids are contributing towards the back-to-school bills,” Mathews said. “Teens and pre-teens will be spending $63 of their own money, which works out to $1.5 billion overall. This is significantly higher than the levels we saw a decade ago.”

Although the news about increased spending on back-to-school supplies may be alarming, these days there are more ways than ever to save. A little ingenuity, resourcefulness and research can go a long way.

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News, The Psychology Of Money

Emotional Spending: What It Is and How to Overcome It

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been previewed, commissioned or otherwise endorsed by any of our network partners.

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If the lamp on your desk, the mirror above your daughter’s changing table and those trinkets in your kitchen were all purchases made after a particularly stressful situation, you might be an emotional spender.

And you’re not alone. In a 2017 survey by CompareCards.com, a fellow LendingTree company, about a third of shoppers pulled out their credit cards in an effort to make themselves feel better. The instinct was even more prevalent for millennials — a whopping 48% reported buying something recently because they were feeling down, upset or angry.

What is emotional spending?

Emotional spending is, as you might have devised, the act of buying things with the motivation to make you feel better. Colloquially, it’s often referred to as retail therapy. “I think emotional spending is very common,” said Megan McCoy, an adjunct faculty member for Kansas State’s Financial Therapy Certificate Program and secretary on the Financial Therapy Association’s board of directors. “Anecdotally speaking, I think we saw a marked increase in this type of spending with the rise of online retailers — especially when free shipping and free returns became a thing. Emotional spending increased then because it became so easy.”

When it comes to emotional spending, it’s important to keep in mind that there’s a difference between compulsive spending and spending money every now and then because it gives you a burst of happiness. As opposed to emotional spending, compulsive spending is a disorder where spending has become a customary way of achieving self-esteem or is done to escape reality, and it often interferes with a person’s responsibilities or relationships. It’s best to consult an expert for help if you think your spending has escalated from being prompted by emotional triggers to compulsive behavior.

The root cause of emotional spending

Since emotional spending is the act of buying things to make you feel better, the spending itself is often triggered by something personal that charged you up. Of course, these triggers can range dramatically based on your personality and individual circumstances, but Dr. McCoy said that common triggers for women include relational disturbances (aka fights with a partner or other loved ones) or feelings of loneliness (aka feelings of being unloved or undesirable). Those emotions in turn cause feelings that make us want to spend since we could be thinking that once we buy those jeans or that new makeup, we’ll look different or be loved, she said.

While Dr. McCoy said that a man’s emotional spending is more likely to be fueled by reasons having to do with success (or feelings of inadequacy when it comes to success), for both men and women, emotional spending may not necessarily be something that they are even aware they are doing. “Emotional spending can be an unconscious power trip,” she said. It’s often fueled by a desire to do something that proves a person can make their own decisions and do what they want.

How to break the emotional spending cycle

A habit is, by definition, something that is hard to give up, and if you’re an emotional spender, moving away from the tendency to spend money when you’re feeling emotional can be a difficult thing. On the other hand, emotional spending is often a consequence of impulse rather than thought, Dr. McCoy added, and “by recognizing that this has been a pattern of coping in oneself, you can find other ways of coping and stop emotionally spending quite easily.”

If you recognize yourself in the above description, there are a few things you can do to help break the emotional spending cycle.

1. Come up with a list of other coping techniques. Spending money might make you feel better in the moment, but chances are after you receive your credit card bill or realize your wallet is empty when you need to buy lunch, the feelings of guilt will set in. Instead, Dr. McCoy suggested putting a little thought into some other ways to blow off steam when you feel upset. “Find out what else makes you feel regulated,” she said. For example, maybe going for a run, listening to your favorite playlist or having a cup of coffee will provide you with the same rush that spending does. At the very least, it might cause you to pause long enough to realize that you don’t actually need to spend money to feel better.

2. Do the math. Something that works with spending in general is to take a moment to consider just what that new throw pillow will cost you, even outside of its monetary value. “My favorite trick is to always do this simple math when shopping,” Dr. McCoy said. “Whatever you want to buy, just figure out how many hours you will need to work to buy it. You want to emotionally spend on a cardigan that costs $75. You make $20/hour. Is that cardigan really worth almost four hours at your job?”

3. Have a budget. With a proper budget in place, retail therapy isn’t completely forbidden, which some people might find helpful. Create a budget that provides for some level of emotional spending within those constraints. That way, if you do find yourself feeling like you need to buy that cashmere scarf after the huge blowout you had with your sister, at least you will have factored that spending into your monthly budget.

If you need a little help putting a budget together, get started with our ultimate guide to budgeting, and learn about some of the best apps to help you maintain that budget.

4. Start a journal. Studies have shown that journaling has all kinds of amazing side effects, and helping you combat your emotional spending could be one of them. Dr. McCoy suggested creating a thought journal where you record the events that led up to a shopping spree, along with the actual shopping. “Thought journals are basically the cornerstone of cognitive behavioral therapy,” she said. “According to CBT, thoughts and behaviors are so intertwined that sometimes we can’t remember what came first.”

By using a thought journal to record your spending habits, you’ll be able to identify the anecdotes that caused your emotional spending so you can recognize what’s actually bothering you and work on fixing the root cause. “In other words, it allows you to identify the underlying problem and fix that, instead of just dealing with the symptom — shopping,” McCoy added.

5. Create barriers to spending. Emotional spending (and overspending in general) will be harder to do if you create barriers that make it physically harder to spend. For example, remove your credit card information from being cached in the websites where you frequently spend. Unsubscribe to emails from stores you love. Set a five-minute waiting period before you spend on any nonessential items.

The bottom line

At the end of the day, emotional spending can break the bank, and it doesn’t necessarily help you deal with your actual problem — whatever it was that triggered your spending in the first place. If your emotional spending has already put you into debt, you can learn more about the emotional toll of debt and how to tackle it.

These days, online shopping makes it easier than ever to spend, and social media makes it easier than ever to identify the Joneses we want to keep up with. Luckily, with just a few small steps, emotional spending doesn’t have to be a hindrance on your finances anymore.

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How to Shop and Save on Closing Costs

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Back in April my husband and I put in offer on what would be our first home, and — joy of all joys — it was accepted.  We were finally on our way to the last stage of the seemingly never-ending home buying process: closing.

If you’re like us, then by the time you’ve decided to plunk down six figures on a new home, closing costs might seem like a minor fee. But these fees can add thousands of dollars to the cost of your home. According to Zillow, closing costs generally cost 2-5% of your home’s purchase price. On a $200,000 home, that could mean forking over an extra $4,000 to $10,000. (If you’re lucky, you can negotiate for the seller to cover some of your costs, but it’s still a big chunk of change.)

What many people don’t realize is that not all closing fees are set in stone. You can shop around and find better deals if you so choose.

We’ll explain which fees you can shop for and how much you can save.

Closing Costs: The Basics

Although you typically pay your closing costs in one lump sum, you’re actually paying for several different fees. Those fees cover things like your real estate attorney fees, your appraisal, title insurance, and a pest inspection. Your lender is required to give you a list of your closing costs along with your loan estimate within three days of receiving your loan application. That list will contain all the services you need to pay for and the different vendors the lender has chosen to provide them.

Closing fees can sometimes be bundled into your mortgage loan, which can save you the trouble of coming up with the cash right away.

But if you’ve got time on your hands – and you’re willing to put in the effort —  you can shop around for some fees and save yourself several hundred dollars. Here are a few fees that you can shop for (this list will vary from lender to lender, but it’s a good place to start):

  • Title fees (including the Title Search, Title Insurance Binder, Title Settlement Agent Fee and the Lender’s Title Policy — although keep in mind that in many cases the seller actually covers some of these fees … more on that later)
  • The Pest Inspection Fee
  • The Survey Fee

If you decide to find your own vendors, you need to decide quickly — ideally, before you put in your offer. Title insurance items are especially tricky to shop for after your offer has been accepted by a seller because some lenders require that your realtor write those stipulations into the contract of your offer. If they aren’t written into your contract ahead of time, it’ll likely be too late to go back and say you want to do some cost comparing later.

States, and even individual counties, often have their own laws regarding closing cost fees and transactions. Ask your realtor, real estate attorney and/or mortgage broker about the laws where you live. First American Title, a leading provider of title insurance in the U.S., has a state-by-state guide of real estate laws and customs on its site, but it might be hard to understand the jargon without the help an expert.

As we mentioned before, your mortgage broker is required to give you a list of companies in your area that provide the services for which you’re shopping. Just remember that if you decide to shop around for a vendor not on the list, your lender needs to agree to work with your outside choice.

How to save on closing costs

Title documents

What it costs: Title items usually come as a bundle (including the Title Search, Title Insurance Binder, Title Settlement Agent Fee and the Lender’s Title Policy), and the national average is around $2,263.16 for the package, according to Closing.com, a premiere source for closing costs and service providers in the U.S. residential real estate industry.

How to shop for it: Confirm that whatever company you go with is a licensed title insurer in your state. A good starting place is throughThe American Land Title Association, where you can find reputable title service options in your area. Jeffrey Goldstein, a real estate attorney, recommends working with companies that work in every single state in the U.S. and are considered among the safest underwriters. A few of these companies include:

Is it worth it? It could be.

Title items are tricky since they come packaged as a bundle and, as mentioned above, often the seller covers some of the fees (this will be stipulated in your contract if it’s the case with your offer). Asking to shop around for outside offers may mean giving up your right to have the seller cover his or her portion, or it may make your overall offer less desirable altogether. You’ll need to verify with your realtor and lender the rules in your area, but if the seller and your lender are game to let you do some research, this is definitely where you could save the most money, since it’s one of the most expensive closing costs.

Pest Inspections

What it costs: The national average is $126.37, according to Closing.com.

How to shop for it: Pest inspections aren’t always required, but if they are or you’d just like one, finding a reliable pest inspector in your area probably won’t take much more than a quick Google or Angie’s List search. My search for good pest control companies in my area on Angie’s List is here — just replace Arvada with your hometown to find ones in your own neighborhood.

You can also try The National Pest Management Association to help point you in the right direction.

Is it worth it? This one may not be worth the time and effort. Prices are so low relative to other fees that you may not feel like you’re saving much.

Surveyors

What it costs: The national average is $587, according to Closing.com.

How to shop for it: Land surveyors help you understand where your property line is exactly. Sometimes a land survey is not even required in closing, but it might be. To find a good surveyor in your area, The National Society of Professional Surveyors is a good place to start. As an association of licensed professional surveyors with access to reliable surveyors all over the country, they can point you to some good sources in your own area to do your price comparing.

Is it worth it? Depending on where you live, it could be. In Alaska, for example, the average land survey costs about $1,400. In D.C., however, where the typical survey costs $185, it’s probably not worth the effort. Check with the NSPS to get an idea for what the typical survey costs in your area before doing the work.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.