Recently a coworker and I were discussing how his wife would not be returning to work simply based on the fact that child care was too expensive. At the rate it would cost her to place the child in daycare and go to work, she’d actually be “losing” money.
Simply put: If you compare dollar to dollar, it may not make any sense to go to work if you’re going to pay out more than you take in.
As a parent, I can definitely tell you – kids are expensive! They eat a lot of food, wear a lot of clothes, need a lot of entertainment, and require a lot of stuff.
It wasn’t that long ago that my wife and I had to make the same kind of decision ourselves. At the time, my wife was making around $1,000 net per paycheck. The cost of our daycare: About $1,200 per month. So over half of her net income was simply going to daycare! There were times where we said “What’s the point?”
Choosing Child-Care Over Work:
The media also has no shortage of stories that highlight the same issues as well. Some of the other popular reasons parents are choosing to stay at home (outside of just daycare costs) include:
• Low wages
• Long hours
• Insurance costs (if you have a high co-pay deducted from your paycheck)
• Commuting costs (gas, car maintenance)
• Costs to otherwise keep up on household or yard maintenance (i.e. paying someone else to clean up your house)
• Lack of optimism for career advancements
• Overwhelming sense of purpose to raise their children themselves
But Forget About These Perks:
While all of these are perfectly valid reasons, I would urge that people don’t forget about some of the potential benefits that going to work still may provide them:
• Insurance: I’m hoping your work covers your insurance with little co-pay. This was probably one of the biggest reasons my wife did not stop working. At the time we were enjoying “the Cadillac” of life insurance benefits and knew we’d spend a fortune in medical bills if we didn’t have it.
• Employer Retirement Plan: In the case of my wife, we would have had to give up a 403b and a government pension plan. Unfortunately as a stay at home mom, my wife would not have enjoyed these great benefits.
• Other Small Gestures: I know if I quit my job, I’d have to give up my Smartphone, my laptop, and a variety of other perks I enjoy as a result of having a job. The cost of these things should be added to your list of things to consider before making the cut.
• It’s Only Temporary: It was only five years until our first child started Kindergarten. Not too far after that, both our kids were in school full time. Once that happened, the +$1,000 we were sending in daycare payments vanished. So what did we do with all that money? We still pay it, but to our IRA’s instead. From a budget standpoint – we never got our money back!
• Career: Lots of women (and men) go to college for a reason – to one day start a career doing something they’d love. Although it may make financial sense to put things on hold, this may not fulfill your career desires. Couples should be careful to weigh each person’s sense of goals and accomplishments with respect to how they would like to approach the subject of daycare.
Readers: What do you choose, and why? Are you a stay at home mom (or dad) that decided it would be better than going to work? Do you know someone who has done this? Did you decide to move forward with your career? What were the reasons?
Photo Credit: “Lillian’s First Week at Angie’s” by mbaylor on Flickr