The True Costs of Having a Baby - Part II: To Work or Not To Work?
July 2, 2012
This article is part two of a five part series concerning the costs of having a baby.
Have you considered how you'll manage on the reduced income caused by time off for the pregnancy and birth? Be sure to factor in any potential loss of income if you and/or your spouse take unpaid leave. Even if you don't have disability insurance, your employer may be required to grant you time off under the Family Medical Leave Act (FMLA), but they're not required to pay you during that time – check to see what type of leave you may qualify for. If you take unpaid leave, calculate your regular expenses during that period (i.e. mortgage, utilities, insurance, groceries, etc.) and determine how you will meet those expenses.
One Income vs. Two
One of the most difficult decisions for new parents to make, is whether to have one parent stay at home full-time. This decision is often made based on financial considerations rather than emotional and developmental considerations. Here are some questions that might help guide your decision:
- Are both jobs paying off? A job is more than just income - it also includes expenses. There's gas and other transportation related expenses. You may eat out much more when working. You will need to pay for childcare while you are both at work.. Add up all of these work-related expenses to figure out how much you would really lose by staying home. It may not be as big a loss as you originally thought.
- Can you afford not to work? Subtract your income and work-related expenses from your budget. If that produces a deficit, see if you can eliminate or reduce any expenses but keep your savings as high as possible. If you need to start cutting back, it's best to start slowly. Keep trimming expenses and eventually, you may have cut enough to quit your job. Even if you can't, you will have learned to live more simply and have increased your savings in the process.
- What are the emotional costs? Some parents can't wait to get back to work after maternity or paternity leave. As beautiful and enjoyable as the parent-child relationship is, it can get stifling. Parents often yearn for the company and conversation of another adult, the satisfaction of working and the structure of a regular day at the office. If you decide to be a stay-at-home parent, make sure you receive the stimulation you need by getting out of the house once in a while, spending time with friends, or arranging a trusted babysitter so that you can spend some time taking care of only yourself.
On the other hand, many parents feel guilty leaving their child at daycare and have a hard time going back to work. They fear that they aren't good parents. But happy parents make the best parents. So working and coming home to spend happy, quality time with your child may be a better option than scrimping to spend 24 stressed hours a day with your child.
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