Soaring Back-to-School Costs: How to Save and Stretch Your Budget Amidst Tariff Hikes and Inflation
As the new academic year commences, families nationwide grapple with escalating expenses.
In the months preceding the Trump administration’s latest tariff implementation in July 2025, the U.S. Chamber of Commerce reported a significant surge in tariffs on back-to-school items, rising from 5% in 2024 to 18%. According to the Bureau of Labor Statistics, prices for educational books and supplies increased by 9.4% between May 2024 and May 2025.
In response, households are making financial adjustments. Nearly half (44%) of parents plan to reduce necessary expenses to accommodate school shopping expenditures, while 44% anticipate taking on debt, as indicated by a Credit Karma survey. The average American family expects to spend $570 per student on back-to-school shopping this year, according to a Deloitte report released in July 2025.
The pressure on prices has pushed consumers to seek savings wherever possible. Seventeen states offered or hosted sales tax holidays during the summer of 2025, each with unique policies regarding eligible items and timings. These holidays exempt certain purchases from state taxes, potentially providing significant savings for families. Online retailers like Amazon also waive taxes on eligible deliveries to states with such holidays in effect.
Public libraries present an alternative means to save not only on physical books but also e-books, audiobooks, and movies. Many public libraries offer printing services, discounted local attraction tickets, and cost-free tutoring resources that can be utilized year-round.
Online retailers have become a preferred shopping destination for over two-thirds (67%) of consumers during back-to-school season. Shopping online offers the convenience of directly comparing prices among various retailers and facilitates bulk purchases, thereby stretching budgets further. However, families that predominantly shop online tend to spend $100 more than those who opt for in-person shopping, as reported by Deloitte.
Finding local deals may require exploring beyond traditional retail outlets. Thrift shops like the Chatham PTA Thrift Shops in central North Carolina, which support local schools financially, have been stocking up on back-to-school items since January 2025. These stores see hundreds of visitors daily, including families and college students seeking affordable clothes and school supplies.
The growing number of states with “right to repair” laws make it easier for consumers and independent businesses to repair electronic devices without manufacturer involvement. These laws were first enacted in New York (2023) and Texas (June 2025), potentially saving families hundreds of dollars annually, according to an advocacy organization that supports these laws.
Traditional 529 college savings plans now offer the possibility of increased savings before high school graduation. The One Big Beautiful Bill Act includes changes to 529 plans that allow parents to withdraw money for expenses related to K-12 education, including books, standardized test preparation materials, and other educational resources.
While federal income tax deductions are not applicable for contributions, most states offer tax deductions on contributions to these plans. Importantly, earnings withdrawn for qualified educational expenses are exempt from both federal and state taxes. However, it is crucial to maintain accurate records of purchases, balance current spending with future savings goals, and consult an IRS representative if unsure about qualifying expenses.
Impulse buying can lead to unnecessary costs, especially when children desire trendy sneakers or expensive first-day outfits. Establishing a clear budget for back-to-school expenses and involving children in the budgeting process can help control costs and instill valuable financial lessons.
Incorporating children into the back-to-school budgeting process often results in less stress, as children become motivated to work within limits instead of against them, according to Julia Perez, a wealth manager at Crux Wealth Advisors. Explaining the importance of saving for long-term goals can help develop critical foresight and discipline that can guide future financial decisions.
Over time, these habits can foster a mindset where savings become second nature—an invaluable skill for managing expenses like rent, student loans, or purchasing a first home.