Are You Really Able to Live Off One Income to Stay Home? And Should You?

So you will soon have or now have a little one to care for and the question arises, should you stay at home to care for your child or should you put your little guy or girl in a daycare? This is assuming, you’re not one of the lucky ones that have a free daycare service known as Grandma’s house. To figure out if you can afford to stay home consider the following; 1.Do you have credit debt in the thousands range? Debt that you haven’t been able to pay down completely for more than one year? This would indicate that both your income and your spouse’s income combined is not enough to pay down debts in the near term. If this is the case, then losing one income will bring a huge amount of financial and emotional stress. 2.Do you have assets you’re willing to sell? Do you own 2 cars? Do you own a vacation property? Selling an asset that you don’t “need” can make it possible for you to stay home, depending on your specific situation. 3.Make an extensive budget of your existing inflow and outflow of money and compare to the one income you’ll be living off – is there a lot left over? Look to areas where you can cut back, does this make a big difference in money saved? 4.Consider the benefits you will lose if you quit your job – does your spouse’s employer provide adequate health, dental and vision benefits for your whole family? 5.Consider the long-term financial sacrifice: Every year you don’t work is money lost into social security and pension funds. 6.Most importantly, consider the childcare costs: if you don’t have a big salary, then even moderately priced daycare can devour more than 2/3 of your take home pay after taxes. Consider if the little that’s left over is worth staying in the work-force. Really Consider the Value You Personally Attach to Staying at Home If you cant even bare the thought of leaving your baby to work a full time job, then try to stay home. You’ll all be happier in the end this way. However, be forewarned that living off one income in today’s society is brutal. You’ll penny pinch like you never thought you could before, you and your spouse WILL argue about minute purchases and you’ll be stressed to some degree. Make sure staying home is worth it to you and your spouse, so you can weather this storm. An alternative option is to consider a career change to a more family friendly, flexible or part time career. For instance, some in nursing profession only work 2 evening shifts per week after their partner comes home, so they can spend most of the time with their kids. Doing something, even on a very part time basis can keep a small stream of income flowing your way and your resume without a gaping hole. Babysitting, tutoring, music lessons, anything you can do from home, freelancing or contract work are some more ideas that come to mind as good flexible options for parents.