Aussie families are shelling out so much on rents, mortgages and other living costs that back to school spending has become a major squeeze on their finances.
The result is that 58 per cent of parents reported plans to cover costs with credit cards and loans, according to a new survey from Compare the Market.
With ballooning home loan debts and skyrocketing rental costs, NSW families were some of the most exposed, having to enter further debt to foot the bill of their kids’ education.
Sydney homeowners are now shelling out an average of nearly $22,000 more per year to service their home loans than a decade ago, while Sydney rent prices recently hit a record high.
The cost of back to school items has reached $845 in NSW according to Compare the Market. Picture: iStock
Over half of all NSW households with a home loan were reported to be in mortgage stress at the end of September 2025, while four in five tenants across the state were in rental stress.
And that is following a year of three consecutive cash rate cuts. Now, predicted rate hikes are on the horizon.
According to data from Compare the Market, the average spend on uniforms, shoes, electronics and other supplies has climbed to $845 in NSW and $767 nationally.
Over one third of the Australians surveyed planned to cover back to school costs with credit cards (38 per cent), while buy now, pay later services (17 per cent) and personal loans (3 per cent) were also considered as ways to get by.
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Almost 40 per cent of families plan to use credit cards to pay for school supplies. Picture: Justin Sullivan
Compare the Market’s Chris Ford said January could be an expensive month, with many families still counting the cost of Christmas.
“Parents don’t get much of a break over summer because when the holiday spending is finally done the school supply list drops,” he said.
“This year the average spend (nationally) is more than $700 and that’s a lot for families who may already be struggling under the weight of energy bills, insurance and mortgages.
“And according to our survey, only a third of parents will pay for supplies out of pocket, with the rest all dipping into credit cards or adding to other debts to survive.”
Putting the average $767 school supply bill on a credit card with an interest rate of 18 per cent, Mr Ford said it would take almost five years to clear the debt while making minimum repayments, with that debt ultimately costing parents $1,150.
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Buy now, pay later services are another method being used to cover school costs. Picture: NCA NewsWire/Nikki Short
This is without tuition fees, which cost a pretty penny in NSW.
According to Finder, the average annual secondary school tuition in NSW is $599 for government schools, $5,037 for Catholic schools and $15,273 for independent schools.
Finder found that Aussie parents will spend a total of $14.4bn on back-to-school costs in 2026, including tuition, school supplies and other costs.
On average, it will cost $2,847 to send a child to primary school and $5,310 to high school in 2026.
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Compare the Market’s Chris Ford
Mr Ford encouraged parents to try to limit debt where possible and look for alternative strategies to help cover school costs.
“Most schools will sell good quality second-hand uniforms, or you could try organising a free swap with friends who’ve outgrown their old gear,” he said.
“Remember the stationary list is a guide, not a rule book.
“Crunch the numbers, compare prices and scratch anything off the list that you already have in the bag.”
Mr Ford also advised families to look out for different incentives to ease the burden.
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The average back to school spend in NSW is $78 higher than the national average. Picture: Getty Images
The NSW government website states that there are “several options to get financial help to meet education expenses, depending on your circumstances”.
These include government and NDIS support, voucher programs and student Opal cards.
According to the Department of Education, those who are unable to meet educational expenses such as uniforms because of financial hardship “may be eligible for exemptions or financial help from the school.”
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