This is one of the most hotly debated topics in personal finance – is it more effective to be a one-income or two-income family?
My own life is in that relatively early stage where kids are not yet a concern, but they are in the planning stages. Inevitably, the question comes up in conversation – when a baby is born, will one of us stay home to play “Mr. or Mrs. Mom?”
The common consensus of personal finance gurus seems to be that for a second income to make sense, it has to be substantial. This is in part due to child care costs, additional taxes, and other unforeseen expenses. And it does not take into account the emotional well-being of your kids resulting from either situation.
But I don’t want to skew your opinions in either direction just yet…
Weigh In
Readers – this is your chance to share. Do you think a one income family is financially and emotionally better or do you prefer that both parents work? If you have personal experience with either (or both sides), what lessons have you learned and would you have done things differently?
I’ll be writing a follow-up post and will include the best and most helpful answers!
Fiscal Fizzle 
Here’s my two cents: Speaking only in terms of what I have witnessed (I have not yet had a child but can’t wait until it happens š I have been around kids my whole life. My older sister has two children which I babysat since they were in their diapers.
The costs of Child care are substantial and unless the second income (like you have mentioned) is substantial or absolutely necessary for the well being of the family it would be better to have one parent stay home. Also kids can learn from their parents and you’ll be able to be with them through their most innocent years. I mean think about it you won’t miss their first walk or word or crawl or turning over because you will be there. what a great feeling!
I think it could possibly also be proven that they will be sick less since they won’t be around other children at all hours of the day (this does not mean that they should be cooped up the house by any means it just means that they won’t be around germs all the time). You can also feed them wholesome foods and be there if they do get sick.
Another option would be part time job for the second parent where the kids can go to daycare twice a week where they can socialize and make friends (a huge lesson for growing children!) and you can make some money, maybe even enough to pay the two days they’re going to daycare (it would shock you the amount of money its costs for kids to go to daycare).
That’s a great point Ellen – stay at home parents can utilize a wide variety of money-making opportunities that can bring in a little side income while not taking up too much time. And I appreciate your point about getting sick – particularly in the face of the recent swine flu events, it’s made everyone a little more edgy about how they interact with other people. I do think that socialization is important, and your idea for a partial daycare (two days per week) is something I had never considered! Thanks for sharing your thoughts.
It depends on the situation. What work arrangement allows BOTH parents to be around? Some one income families depend on a job that pays well but demands a lot of time commitments, while some two income families have a bit more flexibility.
Personal experience from when I was a kid: my mom was a teacher (home a bit after us), dad had his own business, and my grandmother would watch us after school when schedules needed help.
It’s so helpful to have other family members, like grandparents, around when both parents are working! I spent a lot of time with my grandparents growing up, and now my wife’s mom is nearby and absolutely loves kids!
My wife & I have pretty normal jobs. We’re both professionals and both work 8-5 M-F.
We are looking to have children soon & are doing everything we can to prepare for my wife to be able to stay home as much as possible. We both strongly desire to have it that way.
That’s awesome! I’d be interested to know what kinds of things you’re doing to prepare. My thoughts would be to set up a larger emergency fund, prepare a new budget, look at health insurance, etc, etc…but I’m sure there’s other things I’ve never even considered.
We have done and will continue to do both depending on the circumstances. When my daughter was born I sold my real estate business and stayed home with her for the first 8 months. It turned out to be an awesome decision.
We have no problems with both working though, as we might need to do upon moving to Australia. For us, there’s not one superior. It’s whatever works in the current situation.
I think those first few months with a new baby are so critical, particularly your first child. I’m glad you were able to stay home and make that special connection – not everyone gets the chance.
Your point is well taken – no advice will really ever be applicable to everyone. But it’s fun to see how people have dealt with this and what they wished they would have done instead. š
I grew up in a household where both my parents worked full-time jobs. My wife didn’t.
When we had our kid 2 months ago, my wife stopped working to be a stay at home mom. It’s probably the best thing for our daughter, and even though it’s more financially tight than before, the amount of money my wife was bringing home as a preschool teacher is about the same it would cost to have a full-time babysitter or daycare.
Probably the most difficult thing is doing this all is that we had health insurance through my wife’s employer, and my employer has us in a 10% paycut period. So, we’re making it, but we have to be more frugal than ever.
I think a lot of people can relate to your situation – even though mathematically, it may make sense for one of you to stay home – in the larger scheme of things, you’re really taking an almost 50% “paycut” by eliminating one salary. I’m very glad to hear you’re making it though.
Everyone’s left good comments regarding how having a stay home parent is good, if you can a) afford it and b) the second income is substantial. However, we also need to consider the wants and needs of the parents. I’m a mom and love my 2 boys; however, I could never be a stay home mom because I love my career too. Yes, I do make a substantial income, and I also get a lot of personal satisfaction in doing what I do.
I’m not saying that being a stay home mom is bad. In fact, if that’s what makes you happy, that’s what you should do. It’s just not for me. Also because I work, my partner doesn’t have to work as hard and we’re both able to enjoy our kids. When I was growing up, my dad worked hard so my mom could stay home. I didn’t get to know my dad until I was in my teens.
Kathryn, I completely agree. For those who find meaning & fulfillment in their career, it would be difficult to adjust to a stay-at-home mentality.
The last thing you want to do is to grow resentment within you for your situation, your spouse, or your children because they “keep you” from achieving your dreams.
Your point about your Dad brings up a very interesting consideration – the parent that continues to work has to do so much harder, in many cases, than if the workload was more evenly distributed. What starts as a good-hearted effort to connect more with your kids may actually back-fire in the way you describe.
Thanks so much for your input on this!
I agree there is no “right” answer. Personally, I’ve been a stay at home mom for 11 years.
I have worked part-time or on weekends when I had the need to get out of the house or wanted the extra $, but even when we were making $20K a year we didn’t need for me to work.
We have 4 kids so I would have to have a super high paying career to justify daycare/after school care, etc.
I am glad that we started our family fairly young (age 21 and 20) but it is tough to see older parents who have much higher means than we do.
I’m just now getting to the point in my life where I’m thinking about my career. Since my kids are such a big part of my life, I’ve opted to find some non-traditional approaches to working like blogging, and having my own small business.
The other bonus is we never had 2 incomes, so someday when we do (and the kids are older/grown) we’ll be in fantastic shape. š
I should say too my husband worked really hard for a few years (in school and working FT, putting in overtime, etc.) and is now in a wonderful position of being able to work 9-5 most of the time, with little travel, and plenty of vacation/sick time.
(if you read my book congrats!)
Thanks for sharing Kelly! I think a lot of parents find themselves in trouble because they go the other way – from a two-income household to suddenly having to get by with only one (by choice or with the current economy – by force). It’s great that you’ve learned to get by on one for so long. You will truly find yourself in a lot of financial freedom when the time comes that both of you are working, and you always have the option not to! š
This is a difficult question to answer. I know that we can definitely live off of just my husband’s income, but I like the independence of making my own income. In my circumstance, it makes sense to continue working.
1. I make a substantial income. I make almost as much as my husband does.
2. I took off until my child was 5 months before I put her in daycare.
3. The daycare is subsidized by work and I go see her at least 2 times in the day.
4. My husband travels for work or works from home so it is nice for me to come to work and put her in daycare vs. being alone at home when he is gone.
5. I get a sense of fulfillment from my career.
What’s great to hear is that your employer values family enough to help with daycare costs. I wonder if your daycare is on-site, but it sounds like at least it’s very close to where you work. I think a lot of people don’t have this opportunity, but I’m glad to hear that you take time everyday to visit with your daughter – that’s awesome!
A couple of you have also brought up another great point of discussion – how much time you took off once your baby was born. In today’s economy, it’s become increasingly difficult for many to take a lot of time off above and beyond any saved up vacation and sick time, and maternity leave is very limited in the U.S. I’m curious about how many of you dealt with this initial period after birth.
Thanks for commenting Julie!
I do feel that whatever works best for your family is the best choice.
That being said, I wanted to stay home for at least the first year, then have the choice after that. We started living off of only my husband’s income early to make sure we could do it. When I became pregnant, we started banking my salary and also using some of it buy the baby things to get the nursery set up (more of the one-time expenses).
After a year, I decided to remain home and we’ve been fine. I found that we have saved in other areas because I’m not working (eating out, fuel, my work clothes). Plus, we save on entertainment simply because we can’t go out like we used to now that we have kids. š
I also feel that our household runs a lot smoother (for us) since we don’t have to rush in the mornings getting kids ready for daycare or in the evenings, rushing to get dinner on the table and the kids are in bed by 7:30pm. Personally, I think I would be a wreck trying to work outside the home and manage a household. Kudos to those families who do it….it would be really hard for me.
But, like the one commenter pointed out, I didn’t have a job that I totally loved either. I enjoyed parts of it, but as a whole, I don’t really miss it. For me, even though there are days I feel like I want to poke my ears out so I don’t have to hear the word “mommy” one more time, I do really want to be at home with my boys.
I do really miss making money though. I would love to find a way to make money and stay home.
I feel that the gist of a lot of the comments here has been the complexity of this decision, and it shows in your comment, MB. You had to think about your job, making money, handling a household, taking care of the kids, a smaller budget, etc, etc…it makes it that much tougher to figure out what’s best. š
As Leo @ Zen Habits often points out, simplicity sometimes comes with eliminating commitments. For some of you, it sounds like jobs were simply another commitment you just can’t handle when you had kids. The alternative, as MB points out, would be running around in a rush trying to get to everything at once.
All difficult considerations, and very much a balancing act and personal choice for all…