This article was originally published on August 4, 1999 by the Associated Press © 1999 Associated Press

The ABCs of Back-to-School Budgeting IN THE NEXT FEW WEEKS, MILLIONS OF YOUNGSTERS will be trading in their tennis rackets and swimsuits for book bags and jackets — and their parents will be faced with yet another round of seasonal expenses. Back-to-school necessities can add up rather quickly. There's $30 for that new backpack; $40 for gym shorts, $50 for cheerleading uniform rentals, $100 for new software to help with homework. "I think the American household — particularly those that don't budget year-round — will get some pretty nasty surprises during this time of year," said Durant Abernethy, president of the nonprofit National Foundation for Consumer Credit in Silver Spring, Md. He says the NFCC's 1,500 credit-counseling offices nationwide routinely see an increase in activity by late autumn — when the bills for back-to-school supplies and clothing start rolling in, along with some leftover summer vacation bills. Many households handle these extra expenses by charging them on their credit cards. Most people, though, can avoid going into debt if they properly budget for seasonal expenses simply by setting aside enough extra money to handle them throughout the year. Some financial counselors suggest establishing a special interest-bearing account for non-recurring expenses like insurance, vacations, holiday gifts or back-to-school supplies. "It's something that should be done. (But) the reality of anyone doing a budget is not great," said Howard Dvorkin, president of Consolidated Credit Counseling Services, a nonprofit service in Fort Lauderdale, Fla. The group publishes a pamphlet, "Budgeting 101: Your Money Guide for Getting Through School," available free of charge through its Web site (www.debtfree.org) or by calling 1-800-SAVE-ME2. The focus is on college students, though much of information can be useful for high school students or parents of children in lower grades. In addition, the NFCC said it welcomes parents and students to drop in on any of its offices for budgeting tips and counseling, free of charge or for a nominal fee. To locate the nearest office, visit the Web site (www.nfcc.org) or call 1-800-388-2227. Here are some suggestions from the credit counseling experts to help parents and students plan for and save on back-to-school expenses: Estimate expenses. Sit down with each child returning to school and list every expense you can think of, from notebooks to blue jeans. (Don't forget items like haircuts or annual physical checkups, too.) Then have the student come up with an estimate of the cost. Establish a budget. Total all those expenses, then set spending limits for each child. At this point, you'll need to determine what you can pay cash for and what you'll need to charge on your credit card. (Remember: Whatever you put on plastic should be paid off within 90 days.) Determine wants vs. needs. While school supplies are essential, the latest in footwear isn't. Therefore, it's important to differentiate the luxuries from the necessities. Tell your child how much you think is reasonable to spend and what amount you're willing to pay, and have your child make up the difference either with his allowance or money saved from a summer job. Comparison shop. Prices will vary from store to store. Office supply stores, volume discounters and warehouses often offer the best deals. Also, take advantage of advertised specials during the few weeks before school starts, and take your children along while you shop so they can see firsthand the benefit of budgeting. Be creative. Make ample use of hand-me-downs in your own family. Shop resale stores or consignment shops for used clothing. If your child wears a uniform, ask if the school offers a uniform exchange program as an alternative to buying expensive new clothes. Plan ahead for next year. Remember that many schools distribute lists at the end of the school year of the supplies required for the next grade level. If you start at the beginning of summer, you could spread your school purchases over a period of time, thereby allowing you to pay with cash instead of on credit. Also, if there's a big sale on standard school supplies you know your child can use the following year, stock up on them now.