What should a woman take into account financially when wanting to become a stay at home mother?

Question

If a woman wants to leave work and stay home there are a lot of financial things to take into account. The woman may make a salary, but pay for eating out more, professional clothing, child care.....what else financially would a woman have to take into account when deciding on whether or not to stay home. Have you transitioned to staying home? Where do you find you actually save money because you are home? What were some of the hidden financial costs of working?

Answer 1

I recently went from working full-time outside of the home to staying home with our almost 3 y.o son. Like everything else in life, it has its good and bad points.

You will probably save money by eating at home and shopping smarter. Pre-SAHM, I'd never have bothered clipping coupons - who had the time? These behaviors extend to larger purchases as well (I shopped around for a great price on our new garage door opener, for example), so it can add up.

If you wore business or business casual clothes to work, then there may be some slight savings. My experience was that I actually had to buy jeans, tees and sneakers - I only owned a few things for the weekends, not enough for the daily grind.

Commuting costs may decrease, too. My husband now hops the train, and my son and I walk nearly everywhere. This had made a big savings, and if it means we don't replace our car for an extra year or two, then that's some major bucks.

I also think that thinking about your budget simply leads to spending less money. And now that there's time to make better decisions, most of us do. I don't feel deprived if I can't have that sweater, for example, because the 15 sweaters I already have are neatly laundered and stored in the right place. Less chaos, more calm - it can't be bought! :)

There are a few areas, though, that might surprise you.

* We still pay for childcare. Now that our son is nearly 3, he needs time with other kids - more than he was getting in a once-weekly playgroup or story time at the library. Part-time nursery school can be expensive, but it's worth it.

* Now that you have time to take your kid to lessons, you might want to enroll in Gymboree or swimming ... even with a smaller kid. Some things are free or cheap, but that's not always the case. (My hockey-obsessed 3 y.o. wants ice skating lessons. Cha-ching.)

* Some women have also mentioned to me that they finally have the time to take on those projects around the house - planting a garden, painting the study - but realize that they're breaking the budget taking them on. Likewise, if you're a recreational shopper, watch out! It's an easy trap, especially when you have the time and the mall has that great kids' playspace in the center.

* When your primary role is caregiver, you'll need to budget in some bucks for luxuries - a latte, a movie, a pedicure. Taking care of yourself is important, especially when you've just taken on a 24/7 kind of job.

* Lastly, and this is the big one, you'll need to figure out how to save for retirement now that you don't have an income. In addition to looking at your monthly budget to see where you can make cuts, examine your long-term financial position. If you're not saving for retirement at all, now's the time to start. And if you're saving through automatic payroll deduction, you'll need to figure out how to replace those dollars.

Answer 2

I have two degrees and was the higher income earner before becoming a SAHM. It's the things you mention - with the clothing also comes drycleaning bills if you're a professional. Not having as many was a real blessing! For me, it was other stuff like makeup, getting hair styled not as often, business trips, office gifts, no coffees and meals out... there are so many things.
Once at home, doing all the cooking and a lot of baking. Having the time to go through flyers, do coupons, etc. to make sure you are getting the best deals on groceries - and being able to go out to a variety of different stores during the week.
For us, it was having NO entertainment budget. Books from the library and movies from there, too. We didn't even have a computer til a year ago, used the one at the library.
It's a lot of sacrifice, but anything is worth the cost of having a wonderfully happy child, husband - and mom and wife! Our son is thrilled, husband is happy, and so am I!

Answer 3

My husband and I decided to have me be a stay at home mom almost a year ago. When we sat down and figured things out, we figured that with me working and paying taxes, childcare, clothes, gas, food at work, and everything else that goes along with working, weren't making much more than we would have been if I didn't work. We've had to make some cuts like not eating our or freely spending money. But, it's worth it. Actually, with me not working, we are making $200 more a month than we were when I was working full time becuase we dont' have to pay for daycare! Crazy huh? We save money with me staying home because I'm not driving the 30 miles to town and back to and from work every day, we're not paying nearly $500 a month in childcare, I don't have to buy and maintain work clothing any more, I don't have to eat out or pay office dues any more. It's definitley worth it!

Answer 4

When I became a SAHM, our biggest issue was the health insurance coverage. Between the plans DH's employer carried and my employer carried, we came out with "decent" coverage at reasonable cost. When I left the workplace, we were demoted to lousy coverage, but price was decent, and luckily we were healthy. When DH lost his job five years later to outsourcing, even the "lousy" coverage available through COBRA had become unaffordable, and we no longer had the backup offered by a second job in the family. We kept the COBRA for 18 months at huge expense to the family, and because of preexisting conditions, were unable to find any kind of plan to replace it.

Our family is fortunate; we've finally found a "catastrophic only" coverage; I would recommend that other families make darn good and sure they have an affordable path to health care or medical insurance when one partner leaves the workforce.

Finally, one cost that snuck up on us: we live in the country, daughter is an only so we have no neighborhood children to play with. We took occasional trips to the park in town, but you don't get to choose your playmates at a public park. We did a three-year-old preschool for three hours a day that was quite costly and not exactly what I had wanted academically, but the location was convenient. This gave my daughter exposure to other kids, she became comfortable with other grownups being in a position of authority; we met other like-minded families ... but this was an expense.

Finally, when my daughter entered public school, I learned that the schools perceive SAHMs to be a bottomless well of volunteerism ... which can also be an expense as you find yourself driving to school four times a week to help with this or that; "donating" supplies for this or that activity; etc.

By the way, the advice to sock away 80% of your paycheck is excellent!

Answer 5

Also consider car maintenance, gasoline. I am a stay at hoem mother, luckily I don;t have a choice as I am disabled. I dont think I could handle havign to leave the care of my children to someone else.
Also consider if you DO stay home, higher utility bills because youi will be there all of the time. Not much difference for us, but there is a difference.

Answer 6

The best thing to do is to start putting 80% of your take-home pay in a savings account. If you can do that for six months and still keep the household going, then go for it. Not only will you have figured out how to make it work, you'll have a nice little nest egg.

Answer 7

You forgot travel expenses and you spend more on laundry/dry cleaning, if you wear makeup or hair styling products (and hair salons)...there are other things that you will do or purchase just because you're working...like go out with co-workers to have a drink after work, or order from Avon because your co-worker is selling them, etc.

Answer 8

There are GREAT resources if you are considering to become a SAHM (I myself am as well!)

www.mommysavers.com
www.frugalmom.net

Plus, this article is really good:
http://articles.moneycentral.msn.com/CollegeAndFamily/RaiseKids/CostOfBeingAStayAtHomeMom.aspx

If you browse through these there are many articles and calculators you can use to determine if you should stay at home.

Good luck :)

Answer 9

well my husband has a great paying job.. If he did not, then I would have to work myself...
You have to make a lot of adjustments thogh,...we dont go out and eat a lot anymore.... I only go to the store when we NEED something......
Its hard, but if you try YOU can do it