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Back to school is a gold mine for retailers

Back to school is the second busiest retail time of the year, second only to Christmas. We’ve all seen the commercials with happy families skipping up and down stores aisles filling up shopping carts with knapsacks, lunch boxes, note books, pencils, pens, etc. Unfortunately this happy picture is not indicative of many Canadian families for who back to school is a terrible financial burden.

What RetailMeNot.ca says about back to school

92% of Canadians agree that purchasing back to school items can be a financial burden on families

91% believe that back to school shopping is becoming more expensive year after year

This year, Canadian parents are expecting to spend an average of $472 on their child for back to school shopping, $143 more than what they expected to spend last year ($329)

University students are the most expensive to shop for with those parents expecting to spend $1,630, compared to $412 for high school students and $318 for elementary

8 Tips for beating the financial stress of back to school

Only buy what you need. Reuse items when possible. If the knapsacks and lunch boxes are still good from last year, reuse them. The same goes for pens, pencils and other school supplies.

Hand down clothing or do a clothing exchange with your friends. It’s a common sense way to save money.

Create a budget and stick to it. We can’t stress enough the importance of a budget to maintain control of your finances.

Search for the best prices: Don’t just walk into a store and pay full retail price. Search online, look for coupons and promo codes and wait for sales.

Shop any time of year you find a sale and put the items away for back to school. Shop the Boxing Day sales or Thanksgiving Day sales and put away the clothes, shoes, knapsacks, etc. for back to school. It’s a great way to save money.

Designer brands are not a necessity. Although many parents feel pressured into buying the latest designer brand for their kids, it’s not worth going into debt for.

Go shopping with a friend and split bulk purchases. Buying in bulk is not always cost-effective for a single family but if you can split a bulk buy with a friend you may be able to save a considerable amount of money.

Pay with cash. When you shop with a credit card it’s easy to lose track of your spending and then next month you’ll get a bill that you can’t pay.

What to do if you have too much debt and back to school costs will put you over the edge

If back to school is a financial burden, then you need help from a debt professional now before your situation becomes critical. The Ira Smith Team is here to help. Meet with us for a free consultation. We’ll evaluate your situation and come up with a solid financial plan so that Starting Over, Starting Now you can be well on your way to conquering debt.

Managing debt or talking about sex?

It’s commonly believed that all parents dread having the “sex” talk with their kids, but a recent study from BMO shows parents would rather talk to their kids about sex than their financial situation and managing debt. Imagine that! Canadians are stressed about money and probably feel ill-equipped to educate their kids about finances and managing debt.

Personal debt in Canada

According to a new national study conducted by Leger:

Canadians struggle with regret over financial decisions
Argue over spending
Feel pressure to keep up with friends or colleagues
Bend the truth to friends and family about their financial situation in order to save face

A Bank of Montreal study reports that:

More than 33% of all Canadians are ashamed of the debt that they have
Almost 40% say they stress over debt levels multiple times a day

There’s no doubt about it, money and managing debt is the top source of stress in our lives. Why are we so financially stressed? Why are Canadians stressed over debt and have so much trouble managing debt? Here are 10 of the most common reasons:

Expenses are greater than your income
You worry about job security
You’re living paycheque to paycheque
You’re fighting with your spouse/partner about money
You’re paying bills late
You use your home equity like an ATM machine
You’re counting on an inheritance to solve your money problems
You’re late on student loan payments
You’re helping out your parents and your kids
You don’t have a financial plan

Dealing with debt

It’s time to become financially literate and educate your kids, not just about the birds and the bees, but about finances and managing debt. Foresters recently offered 5 tips to get smarter about your finances:

Learn everything you can about your finances, including your mortgage terms, bank interest rates and credit score
Start with the simple things like contributing to RRSPs, setting up RESPs for your kids and protecting your family’s financial future with life insurance
Keep track of every penny you spend for a couple of months and look for ways to cut back and start saving. Even a small commitment to saving will make you feel better about your finances
Look ahead 10, 20 and 30 years. Imagine the life you want and what it will take to make that happen
Talk to your kids regularly about money, involve them in household budgeting, open bank accounts for them and encourage them to save for things they want

How to get help with debt

All of this is great advice to avoid financial problems, but if you are already in serious financial difficulty and don’t know where you will begin on how to manage your debt, you need professional help now. Contact Ira Smith Trustee & Receiver Inc. Don’t ignore your debt issues. Face them head on and with the help of the Ira Smith team you’ll be on your way to conquering debt Starting Over, Starting Now.