Savings: How much of your current combined incomes are you putting toward savings? At what age would you like to retire? Do you plan (and are you able) to save for your children's college funds? Do you have an emergency fund? Sign up for SparkSavings to see how much money you'll need if you want to retire by a certain age and still have money for little Susie to attend a university. Debt and Bills: Do you have large student loans? Car loans? Credit-card debt? Mortgages or second mortgages? When deciding whether to stay home, examine your income-to-debt ratio. Will you be able to cover your bills and pay down debt if one of you stops working? Child care: This is probably the largest area of savings when you decide to stay home. The average cost of full-time child care at a daycare center ranged from $4,560 to $15,895 annually in 2009, depending on location, according to the National Association of Childcare Resource and Referral Agencies. That is just for one child! Where I live in the Washington, D.C., region, the average cost is $13,967 annually, and I know many people who pay more than $2,000 a month for childcare, especially if they have a nanny come to their house. As you grow your family, the cost of childcare could double with every child. Commuting: Depending on how close you live to work, this expense will vary. According to AAA's "Your Driving Costs" calculations for 2008, the average cost of driving just one mile is 54.1 cents. I spent $5.70 a day on Metro fare to and from my work, totaling almost $1,500 a year. If I had driven the same 13 miles to work and paid for parking, it would have cost me about $3,200 per year. Now that I'm at home with my son, we're obviously not housebound, but I drive a lot less than I did. Until your kids are older and the carpools begin, staying at home means a lot less wear and tear on a car than the average daily 45-minute round-trip commute, according to the U.S. Census Bureau. Some families even opt to get rid of their second vehicle when one parent stays home, a sacrifice that, while inconvenient in some ways, can save you hundreds or thousands of dollars per year. Lunch: Try as you might to brown bag it, dining out is an unavoidable part of office life. Couple in the occasional--or perhaps daily--afternoon trip to the coffee shop, and you're easily spending $20 a week--up to $1,040 a year. Even if you and your kids eat out once a month, you'll still spend less than you did when you worked. With a coffee maker and refrigerator full of food close by, you'll be less tempted to run to a deli for lunch. (Plus, corralling kids, car seats and strollers makes you second-guess the necessity of any trip.) Continued › |
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