The Financial Side of Staying at Home

The Sunshine Maker
The Sunshine Maker

Having the opportunity to stay at home with my kids has been the biggest blessing. Countless times I have been out with my kids and have been told by other mothers that their hearts ached to stay home especially when their kids were young but for financial reasons, they needed to work outside the home. I know this is a reality for so many moms.  It would be a tremendous sacrifice to quit a job that is bringing in money for a different kind of job of staying at home with little ones for free. The question is whether or not the sacrifice is worth it.  If you are asking me, I would emphatically reply with a, “Most definitely!”.

windowforblogI do not like it when I hear the phrase “full-time mom”.  In my opinion, every mother is full time, regardless if she work outside the home.  At the end of the day, kids still need dinner, help with homework, a bath, and the house still needs to be cleaned.  Working moms just have a shorter window of time to get all the things done because they don’t have the luxury of staying home from work.  But not all stay at home moms have it made in the shade either. There should not be an assumption that only moms who’s husband are bringing in a significant amount of money have the opportunity to stay at home.  My husband is a very hard working middle school teacher. His level of effort in no way is reflected on his paycheck.

Both of us have always been in agreement that me staying at home with the babies had far more benefits than negatives. So we gave up having a second income source and here is why.

For us, a second income would (1) need to be worth it monetarily and make more than the cost of childcare (see here ) and (2) there would have to be a care option that was as good or better for our children as I am.

Not only is the cost of childcare outrageous, the quality of care just did not meet our standards. In both of these instances, we soon realized that a second income would not be worth it for our family. But to be able to survive with one income and our ever growing family, we had to first accept a few principles and become disciplined and organized with our finances.  Here is a small glimpse into our finances and the guidelines we follow in order to make a living on one income.

Unfortunately, I know that many women don’t even have the option of making this choice to stay home. Regardless if you are trying to find a way to stay home with your kids or are just looking for a way to alleviate financial stress, these principles below may help you begin this journey. I am in no way a financial wizard and this is by no means a complete guide to becoming debt free. These are just a few things that have worked for our family.

purpleflowerblogBelow are 7 principles we follow to make staying at home a reality in our family. You may be surprised at how attainable becoming a stay at home mom can be.

Principles:
  1.  Money is just money.  It comes and goes. Do not think or dwell on it more than you need to function. People with lots of money and people with no money can be overly concerned with it.
  2. Pay all bills first.  Being late or overdrawn is a stress creator that makes you give money more attention than is needed. Free your mind to think about other things by getting bills out of the way. My husband gets paid once a month. This has its pros and cons. A positive is the day the check is in our bank account, I pay all our bills. That way, we know what is left is actually our’s to spend. A negative to the one check a month is if I am not diligent in my spending of the remaining amount that goes toward groceries, gas, miscellaneous, etc, we may end up eating a lot of rice and beans.
  3. Know where your money goes. Checking your bank account on a regular basis (every day or two) is a good habit to have. But if this is all you do to keep track of your money, not only will it grow wings and fly out of your bank account, but also you can have a few surprises at the end of the month. We use the monthly budget on Google Sheets.  Everything we spend ends up documented on this budget and we also have to put each expenditure in a category. I have loved using Google sheets because it lets me know how much I have left in each category. My miscellaneous may be depleted, but I still have gas money and grocery money.  There isn’t a guessing game on whether or not I have the money to spend on X.  Not having to remember what I have in the bank account to spend on groceries frees up my mind to concentrate on what really matters in life. My memory isn’t constantly doing flips and jumping-jacks to remember every detail because it is all recorded for me. Example: If you never write checks (like me) but for some odd reason you need to for a special occasion. When you are toward the end of the month, that unusual check gets cashed and suddenly you are overdrawn because you thought you had more in the account. By keeping a specific budget, you know how much you actually have to spend, even if your bank account seems to say that you have more.
  4. Make it impossible to overdraw your account.  This may not be a popular principle for others to follow, but it has saved us money and lots of headaches. We currently use a credit union (with which we are very happy) but have used a large national bank as well. In both instances, we requested that they take away the ability to allow us to overdraw.  Has this ever happened to you?:  You are out and about and you get something like gas, and then run into the gas station to buy a drink or some gum. Unbeknownst to you, the gas depleted your account and the extra small purchase of less than $2 caused you to overdraw and now the bank will slap on a fee of about $25 for the convenience of not having your card rejected inside the gas station. No bueno! This is a risky way to do finances and much too costly. If you know what is in your account, then there is no reason you need this added feature of the bank spotting you a buck or two so you can pay it back with a large fee attached. Some banks will allow this to happen and will pull the overdrawn amount out of your savings. You do not want this either. One dime of your savings being thrown away on silly in-the-moment purchases goes against the idea of savings. If you are okay with this, you should change your “saving” category to “spendings” because that is all that will happen.  Trust me, I have literally lived this example. If you do away with the ability to overdraw, not only will this help you keep your money in your account, but the embarrassing fear of having your card rejected will propel you into knowing where every dime of your money is so that it does not happen.
  5. When setting your budget, be realistic.  I have learned that if I set my grocery budget too low, I scrape to stay within the guidelines. I don’t buy enough food on my weekly grocery shop and we run out of something crucial, so we go get it as needed. Making more than one trip to the grocery store a week makes our money disappear.  If you are hungry because you set your budget too low, you will eat out more or break your budget and splurge on things you may not normally buy.  On the flip side, if you set your budget too high, you probably won’t have money for extra things like eating out or savings. But you will still be able to spend the money on something.  You may spend a lot but still not have much to show for it, and may have an empty pantry and an empty tank in your mini-van at the end of the month. For a personal example: We started off trying $100 a week on groceries.  With more eaters these days, we have increased it slightly. But this has been very do-able for us for a few years now. Also, when you are realistic with your budget, many times, you will see how much you can save. Even if it may not be a lot each month, having a little savings just makes life less stressful when surprises come up. We aim to have about $3000 in savings.  We are not usually there because things happen. But it is a realistic goal that we plug away at every month.  This amount seems very practical as a Christian as well because we don’t feel like we are hoarding up earthly treasures.
  6. Work to pay off the smallest loans first. I believe this is a Dave Ramsey principle which he refers to as “snowballing”. Basically, the idea is to have a set amount of money to add to one monthly loan payment. Whether you have a car loan, mortgage, student loans or credit card payment, you pay your monthly payments on each, but on your smallest loan, you add the set amount to that monthly payment until you pay off that loan. Example: You have a car loan of $3,000, a student loan of $19,000 , and a mortgage of $100,000. Clearly the $3,000 car loan is the smallest. So you make that payment of $200 each month but you add to it $50. The $50 is the beginning of your “snowball”. You do this every month until you pay off the car loan. Now you have $250 ($50 of original “snowball” + $200 of car payment that is now paid off) that does not belong anywhere. So you add that to your student loan payment that is $300 each month. You were only paying the $300 but by adding your “snowball”, you are now paying $550 a month on your student loan payment. With the extra money, you are paying off bills faster and your “snowball” grows so that you have a bigger amount to put on the loans each month. But this extra money isn’t coming out of your grocery money or even your fun money. Your life won’t change drastically but you will have a great amount of money to put on your loans until you are debt free and are able to enjoy this money that is now freed up. I have never actually followed Dave Ramsey but have heard so many good things and ideas from friends and family that listen to his show.
  7. Give. My last principle is to tithe or give.  If you are a Christian, God calls us to tithe. Not because churches need to build huge, elaborate buildings that sit empty most of the week or because we should all be religious sheep doing what the preacher says. We should give because God knows it is good for our souls. Giving reminds us how blessed we are and that someone else will always need it more than us. It also helps us to remember that nothing is our’s.  If we have been blessed with the ability to eat this week, then continue that gift to someone else. Do not be attached to money. Another reason to give, even if you are not a Christian, is it breaks our obsession with money.  Especially when you do not make a lot each month, giving allows you to know that the money you had wasn’t wasted on selfish reasons. Eating, being able to get to work, and paying bills are not selfish reasons. But spending every dime of a paycheck on things that just get you through another month can feel like that hamster in the wheel that never goes anywhere. Giving to others reassures you that even you can make a difference in this crazy world. If you are not apart of a church or don’t want to give to your church, find a charity.  We have worked with Mission Arlington in the past and they are an amazing group of people.  98 cents of each dollar goes directly to the people who need it. They provide clothing, food, toys, furniture, money for bills, and so much more to the people who walk through their doors desperate for help.

In conclusion, staying at home with your young children can happen.  My husband makes under 50k a year, we have three children under 5 years old, with one on the way, we have a mortgage, and school loan payments that are like an extra mortgage payment each month.  But we are diligent in our budgeting, and we recognize how greatly we are blessed.  I am so thankful that God gave me the title of mother and the ability to stay home with my babies. Not only do we not have to rush out the door in the morning, but my mind can be singularly focused on raising my children and I have the energy I need to do this incredibly important job.

This is just how we do our finances and it works for us.  I would love to hear if you have found a system that works for you and your family! God bless and thanks for reading! Check out more Tips and Tidbits.

2 Replies to “The Financial Side of Staying at Home”

  1. Lots of good tips!! I never actually considered taking away the ability to overdraw. Seems kind of scary, and also embarrassing if your card gets rejected, hah! But if I knew it could potentially decline, I’d be a lot more diligent in knowing exactly how much was in my account.

    1. Its is a little scary. But definitely makes you double check your budget before you go anywhere. When i know its getting close to the end of our paycheck, I am always in the self-check out section at walmart. At least a cashier doesn’t have to see my face if my card is declined. Thanks for reading!

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