Families Pivot to Credit Card Rewards to Offset Rising School Costs

In 2024, Americans redeemed a total of $60.9 billion in credit card rewards, with cash back accounting for $27.8 billion of that sum. These redemptions are particularly critical for lower-income households; those earning under $65,100 accounted for $7.2 billion of the total. For a typical working family, the average annual reward haul of $294 provides enough capital to cover roughly two weeks of groceries or double the cost of expected K-12 school supplies.

Richard Hunt, Executive Chairman of the Electronic Payments Coalition, argues these programs serve as a necessary buffer against inflation. While the National Retail Federation projects a 10 percent increase in back-to-school spending this year—with families budgeting an average of $146 per student for supplies alone—the reliance on these rewards has become a point of political friction. Legislative proposals currently circulating in Washington threaten to alter the credit card marketplace, a move critics warn could diminish the revenue streams that sustain these reward programs. As policymakers debate these changes, the data suggests that for millions of families, the impact of such a shift would be felt directly at the checkout counter.