stay-at-home parent
You wouldn’t just buy a car and then calculate whether or not you could afford it. The same goes with leaving your job to become a stay-at-home parent.

There are other factors associated with staying at home you can’t put a price on, no doubt, but the best way to decide whether or not you can financially afford to stay at home is to budget before you even have children.

Why you should budget beforehand

Babies are expensive, especially during their first year. By looking at your budget before you have kids you’re better able to evaluate and gain an understanding of your overall financial situation well in advance.

Actually calculating the cost of being a stay-at-home parent versus a working parent, before having your baby, will give you the opportunity and time to train yourselves to live off of one less paycheck.

While budgeting be sure to account for both the short term and long term financial effects of being a stay-at-home parent.

Short term 

Short term, staying home will save you money on childcare expenses. Paying someone else to watch your child while you’re at work can be outrageously expensive. Oftentimes, that expense alone can eat into your second paycheck completely. On top of the cost, you need to have a certain comfort level and trust with the person you’re leaving your child with. Staying at home would eliminate this fear.

Although staying at home would lessen your daily interaction with grown-ups – which is an important part of life if you want to stay sane – it would also save you money on your work expenses including: transportation costs, haircuts—although you shouldn’t give those up—lunches, and your daily coffee or tea fix.

Long term

Long term, you’ll need to think about how not working will affect your savings and retirement accounts. If your company matches your 401k contributions, or you’re one of the few extremely lucky people with a pension, you’re potentially losing out on free money.

In addition, being a stay-at-home parent means you’ll be out of the workforce for a period of time potentially making it harder to find a job when you re-enter. This isn’t the case for everyone, but it’s a long term consideration you should account for when budgeting.

This insight and training will hopefully make your decision a little easier about being a stay-at-home parent when the time comes.

The decision is yours

After taking the time to evaluate your budget, your decision might still be a tough one to make as it’s hard to put a price tag on the time you’ll be able to spend with your child. There’s no magic amount which dictates whether staying home makes financial sense over working. Just be sure you’ve weighed both options equally before you’re in the midst and madness of taking care of your wonderful new child (and early congratulations)!

What other factors are you considering before making your decision on being a stay-at-home parent?

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