After a year of persistent inflation and price hikes on consumer goods, many Americans will rely on some form of financing to cover their back-to-school shopping expenditures.

An exclusive CNET Money survey found that 43% of back-to-school shoppers will leverage some form of financing to pay for supplies this year. Of the consumers who plan to use credit, 27% will use an existing credit card, and 12% will open a new credit card.

The survey was conducted by YouGov on behalf of CNET, and took place July 19 to 21. Respondents could choose multiple answers.

In an economy dogged by inflation, consumers are increasingly leaning on credit cards to make ends meet. Americans carry a combined total of $986 billion in credit card debt, a 17% increase from the year prior, according to a report from the Federal Reserve Bank of New York released earlier this year.

When the Federal Reserve works to combat inflation with rate hikes, interest rates on consumer financial products like credit cards go up, too. Last week, the Fed increased the benchmark interest rate again in its fight against inflation, the 11th rate increase since March 2022, bringing the federal funds rate to its highest level since 2001.

Here’s what consumers need to know as they enter the back-to-school shopping season.

Consumers are leaning on coupons and comparison to cope

Overall, 86% of respondents said they will implement at least one money-saving tactic to reduce the financial burden of back-to-school shopping. “Seeking out coupons, sales and discounts” was the most popular money-saving tactic named by consumers (39%), followed by price comparison, purchasing fewer items and buying alternative cheaper brands.

• Nearly three in 10 respondents shopping for children enrolled in a college or university said they plan to leverage credit card rewards to help offset costs.
• One in 10 will use “Buy Now, Pay Later” programs. One in 10 respondents also said they would be tapping savings accounts not intended for educational costs, such as retirement accounts, to bridge the gap.
• High prices continue to press consumers, with 85% saying inflation and rising consumer costs would impact their back-to-school shopping plans this year in some way.

Online research and tax holidays can bring expenses down

The back-to-school shopping season has emerged as one of the major spending periods of the year. The average planned back-to-school spending per household in 2023 is $890.07, up nearly 3% from last year, and up 27.7% since 2019, according to a report from Statista, a data analytics company. A one-two punch of rising school supply costs and stagnant wages has some parents feeling financially squeezed.

“We are spending more time online finding discount alternatives,” said Gareth Barkin, dean of operations and technology at the University of Puget Sound whose child will enter sixth grade this fall. “Everything’s gone up. You have to work harder to find those deals just to break even, because my income hasn’t gone up at the same rate as inflation.” Barkin noted that some universities are making efforts to roll online textbook licenses into the cost of tuition so that they can be covered by a wider swath of financial aid programs.

If you plan to shop online for school supplies or clothing, consider installing a shopping extension that can compare a product’s price across different marketplaces. (Shameless plug: CNET has a free Google Chrome extension, CNET Shopping, that does this.)

Also look into whether your state will have a tax-free holiday in August. This year, 13 states plan to offer a tax-free weekend or week in the coming weeks to help decompress families as they prepare their children to return to school. Your state, city or local school may also have programs in place to help parents struggling to afford school supplies. Parents can reach out to schools with questions and local resources guidance.

Source: Federation of Tax Administrators

Leverage credit cards wisely

If you do plan to use a credit card for back-to-school shopping season, a little planning can help you save money. With the average interest rate on a credit card now at a record-high 22.39% APR, it’s important to pay down your balances quickly to avoid unnecessary additional interest payments. 

Here are some tips to shore up your personal finance hygiene as back-to-school shopping season begins.

• Have an overall budget in mind before you start shopping. This awareness will help you be more mindful with your spending.
• Create a payoff plan for your expenses. This ensures you minimize unnecessary interest payments.
• Leverage rewards programs. When used strategically, credit rewards can help you stretch your dollars a bit further. Make sure you don’t overspend to earn rewards or a welcome bonus — credit card interest will quickly eclipse any rewards earned.

Avoid using “buy now, pay later” features if possible. Instead, dip into savings if you have to, but make a plan to replenish your reserves in the months to follow, especially as we enter the holiday shopping season.

Planning ahead can help cut out the financial stress of back-to-school shopping. Acquaint yourself with money-saving strategies now to set yourself up for success.