Four Crises Facing Thailands Middle Class: Families Cut Everything Except Education and Their Childrens Future

Amid the scorching temperatures in March and April, it appears that Thai wallets are experiencing a severe "financial heatstroke" this year. Many families and individuals are not spending extravagantly but face a situation known as "liquidity shortage" because expenses hit all at once unexpectedly.

According to data from Kiatnakin Phatra Bank (KKP), this period is defined as a "financial summer" battering Thai households, especially the middle class and parents who are struggling to manage their money in time for the new school term.

Breaking down the four waves of rising expenses overwhelming the middle class.

Analysis from the KKP Better app shows that since early 2026, personal loan demand has surged significantly due to four main factors squeezing liquidity as follows.

1. The income tax trap: Paying more while income stays the same?

Data from the Digital Government Development Agency (DGA) indicates that individual income tax burdens in 2025 soared to 432.324 billion baht, a 29% increase over four years. On average, workers need to have 5,000–10,000 baht in cash on hand to pay taxes early in the year—money that ideally should be reserved for emergencies.

2. The summer electricity crisis.

For every 1 degree Celsius rise, electricity bills increase sharply. Air conditioners working 3% harder cause April-May bills to jump 10-30% above normal, becoming an unavoidable "mandatory expense" in this climate.

3. The "spending festival" of Songkran drains money from wallets.

Last year's Songkran expenditures reached 106 billion baht, reflecting that despite economic sluggishness, travel home, merit-making, and social gatherings remain major costs that squeeze other budgets.

4. Children's education costs: "An unavoidable burden" that must be paid early.

This is the heaviest crisis for parents. KKP data shows that parents began "scanning payments" for education rising from February to March—earlier than usual—due to hidden expenses such as special exam prep, enrollment fees, and school supplies, with an average payment of 25,000 baht per child.

"Better to be in debt than let the child miss opportunities."

A striking statistic is that payments for education via this app in 2025 alone reached 46 million baht, revealing a key insight about today's parents: "They can cut personal expenses and live frugally, but when it comes to their children's education and future, they will never back down."

Meanwhile, the condition of "money not keeping up with expenses" has increased demand for loans and available credit lines during this period—not for luxury spending but to "honor commitments" toward their children's future.

Advice for when "money is tight": Manage debt systematically.

When financial "help" is unavoidable, smart debt management becomes crucial:

• Consolidate debts to reduce interest: If facing multiple debts, choosing a personal loan with lower interest than credit cards to pay off high-interest balances can reduce long-term burdens.
• Plan six months ahead: Tuition is no surprise. Monthly savings targeted for this purpose can ease pressure when the school term starts.
• Use digital tools: Regularly check spending habits through banking apps to identify where money leaks the most.

The cost of living crisis and back-to-school burdens are a major financial stress test for Thai families. Admitting "money is tight" is not shameful; knowing how to plan and choose appropriate financial tools is the way to help families survive this "financial summer."

Source: KKP

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