Baby on the way ver.2

**Goldy1** · 08-11-2009, 01:41 PM

Bad choice? No, and it is not uncommon that once that little one is here the woman wants to stay home despite plans. In my OPINION, which is just that, daycare is not bad, but I wold rather do it at 1 or 2 instead of infant age. I had the best of both worlds and I suspect she did too as a mother: a part time working mom.

**wedge421** · 08-11-2009, 02:27 PM

Well you have to figure daycare will be around 800-1000$ a month. Plus you will have to cover all the health insurances etc which will increase for the baby and your wife. I am in the same boat, my wife is 11 weeks pregnant but we have the luxury of her working first shift and me working 2nd at the same hospital. So in theory we should be daycare free.

**zetta** · 08-11-2009, 03:16 PM

Run the numbers on your budget and see where you can cut back so that you can get at least any employer match on a 401k, or send something to ROTH IRA.

You might consider planning on your wife looking for part-time work when your child is 3. Lots of SAHMs send their kids to preschool for socialization at this age.

Also, if you are only 25, your salary is likely to increase as you gain more experience. Devote all your salary increases to retirement savings.

**zakity** · 08-11-2009, 03:32 PM

Could she possibly watch one other child while she is at home with hers? It would be a small amount of income.

**disneysteve** · 08-11-2009, 03:38 PM

There's no right answer to this question but look at it this way.

If you can afford to live on your salary alone for 3-5 years, once she goes back to work, you should be able to put 100% of her income into savings. That's pretty much what we did. When my wife started working again, almost everything she made went to savings. Even now, 50% of her gross goes to her 401k. Another 25% or so goes to taxes so she only brings home about 25% of what she earns, and most of that ends up going towards savings, too.

**cptacek** · 08-11-2009, 03:54 PM

First, what does your wife think? Some women want to go back to work after having babies, some want to stay home, and some, no matter how adamant they are now, change their minds a few weeks after delivery!

If she wants to stay home and you can swing it, I say go for it!

**MonkeyMama** · 08-11-2009, 07:00 PM

I don't think it's a bad idea at all.

We had our first child at 25 and savings was out the window on one income. IT was a little tight for a few years, but it has gotten easier every year.

WE have joked all along that by the time dh can return to work more easily (my spouse stays home), that we won't need the income. That is precisely where we will be when our youngest starts 1st grade. We will probably be contributing 25% to retirement, though we contributed $0, about 7 years ago.

We also went into it with a decent nest egg and start, so I think being 25 and having $32k in retirement is a good start. It affords you to take a break. You may only live on one income for a year or two anyway. The only advice I can give with kids is be flexible, and prepared as can be. Things change and no one has it all figured out before the kid arrives.

Our plan all along was to put 100% of dh's wage into savings when he returned to work - which we did before kids and which we will do again. We are pretty fiscally conservative, but we felt it was worth it. Fact was after taxes and daycare, the second income would be almost worthless. IT could be better to look for stay-at-home, part-time/opposite shift, or flexible work. Makes more sense than working full time to literally only take home $10k per year. It's not that I discount another $10k income - I just don't think you need to work full-time to pull in that much extra.

When my spouse stopped working we took a 50% pay cut (We were equals in salary). But my compensation has gone up about 80% since, which I didn't expect, at all. Still don't make what we used to, but we pay so few income taxes now my take-home pay is about where we were at, combined, 6 years ago. Keep in mind you will likely be able to lower your tax withholdings to squeeze more out of your paycheck.

**elessar78** · 08-12-2009, 06:23 AM

Congrats, Project15.

Good to see that someone else is in a similar boat. I think we'll be both be surprised on how much less we can live on when the time comes. 6 weeks is still early, so best wishes to you and your wife.

**LivingAlmostLarge** · 08-12-2009, 07:32 AM

I'm 13 weeks pregnant and EVERYONE has an opinion on this. Everyone who SHOUDLN'T. Seriously it's up to you.

I can definitely afford to stay at home, and save exactly as we are saving now. We won't have any luxuries my DH wants like a new car, but we can still max out a 401k, Roth IRA, vacation, etc. But lots of extras like new furniture, super luxurious vacations, etc don't.

So that could be a problem. But I'm not sweating it because I think that my DH might change his mind when the baby comes. We're 30 and 32, and been DINKS for so long, that it sort of spoiled my DH. Wanting all these luxuries.

Also, I've been asked already, why aren't you going to work? WHy? Because where i live all women work. Even if they have to pay more for daycare than they make. Why? Because you're supposed to be high powered, dual income couple.

My neighbors are both MBAs, due in October. She hasn't even considered staying at home, and is curious what I"ll do. I can already feel the judgment when I say I'm considering staying at home. She's like "you should work."

I am not lazy, but I want to see how I feel. And yes I have a graduate degree, and I'm writing my thesis. That does not make me a horrible person that I am not interested in being a slave to academia. Geez, I get crap at work, I get crap at home.

I never judge people. I never tell them they are dumbasses for paying $2k/month for daycare and working earning $3k/month, so after taxes they are paying someone for them to work.

But people feel like they can judge someone who might not want to work. And people WONDER, why I want to leave such a damn HCOLA?

Because I think the values are different in a LCOLA area. That it's more common and acceptable to have a SAHP. It's almost like it's required you work here even if it doesn't make financial sense.

But then again, most of the people I work with are fools with money.

**TBH** · 08-12-2009, 08:09 AM

Congratulations!

There are so many unknowns. Will your wife enjoy staying home? Will she be able to find a decent part-time job? Will you have more kids, which would mean she'd be home for longer than 5 years if she stays home til the youngest is in kindergarden? Will your income increase, or will you manage to economize, making it possible for you to meet your goals without having her go back to work?

It sounds like you are in a good position.

I think you should:

1. Plan to suspend savings if necessary in order to have her stay home for a year, then reassess what all three of you need and want, and how you feel about not saving or not saving much.

2. Plan to keep living on your income and have your wife's future income go 100% to savings in order to catch up for the lost years.

3. Think about ways to economize so you can at least save enough to get the employer match if you have one.

**TBH** · 08-12-2009, 08:14 AM

Originally posted by LivingAlmostLarge View Post

I'm 13 weeks pregnant and EVERYONE has an opinion on this. Everyone who SHOUDLN'T. Seriously it's up to you.

This was one of the hardest parts for me about having a kid. Suddenly everyone in the world thinks they can tell you what to do, how to raise your kid, how to do things the way THEY think you should do them. Or they think just because they have a kid already they have been through everything you're going through or going to go through, and it entitles them to tell you, "you will experience the following, and I know because that's how it went for me, and you couldn't possibly have a different experience." ARGH. So annoying.

I think you touched a nerve.

**zakity** · 08-12-2009, 04:18 PM

We couldn't afford our kids when we had them. And, our major oops baby, the second "one", was twins. I had to work. We couldn't afford to feed them if I didn't. We also couldn't afford daycare. I worked part time at night and he worked full time during the day. It sucked big ones.

So, after a few years and after all the bills were paid off except the house, I quit and just stayed home. We also homeschool and it is hard to work and homeschool also. I am actually looking into a job because they are older (13, 11, and 11). They are also eating us out of house and home and we won't be able to afford them again if we don't have more income.

**LivingAlmostLarge** · 08-13-2009, 07:59 AM

Zakity, did you not qualify for help if you were poor? One suggestion is that people who are struggling may qualify for CHIP, food stamps, WIC, etc.

Those programs are in place for people who need help.

**MomEsq** · 08-13-2009, 08:56 AM

First - Congratulations! You have an exciting whirlwind ahead of you!

I have two boys under the age of 5, and because of our particular financial situation, I returned to work about 3 months after each was born. Choosing to go back to work after having a baby is as much of an emotional decision as a financial one. There is no "right" answer. The most important thing to remember is that whatever decision you make as a family will be the right one for you.

While you crunch the numbers, don't forget to consider how your wife feels about being a stay at home mom. It can be isolating and as stressful as any 9 to 5 job. There are professional risks and benefits for moms who take long breaks to raise children - depending on what your wife does for work, she may have some insight on that.

In my experience, children bring a lot of the unexpected -as you look at the financial risks and benefits, make sure you've got some wiggle room to cover those unexpected costs. I'm friendly with a few moms who found themselves in financial straights because they just didn't expect those little things to add up. Of course, everyone's situation is different.

Congrats again and enjoy the next 9 months -and beyond!

Baby on the way ver.2