Post # 1
FI and I are planners, We’re going to begin TTC shortly and have thought about what I would potentially do when we have children.
FI makes good money and I bring home $482/week as a social worker. Le shittay. Day care here is $300/avg per week for an infant. So basically I’d be working for $4.50 per hour.
So we decided that we would explore the possibility of me being a SAHM. Are there any tips on how we can prepare for this? We’re trying to live on one income currently. We will have a house-related expenses and one student loan of $200/month..but do not have any other debt.
What have you done to prepare to be a SAHM? Are there money saving tips if you do currently SAH?
Post # 3
How long until your student loan is paid off? If possible, I’d try to wait till then. Can you downsize/sell stuff/find another small source of income? Will FI have opportunities to move up in his work? I guess its really about your ability to budget. Babies are so expensive!
I’ve been thinking about this and Fi has a fairly large sum saved up for our life together; with that cushion I feel comfortable not working. However, I also have started a business to have extra income if necessary (corporate writing) that I can do from home.
Post # 4
Seriously, take Dave Ramsey’s Financial Peace University. He covers how to get out of debt, retire as a millionaire (even a familily making $50k/yr can retire rich), and be smart with money.
It sounds like it would help in your case!
Post # 5
Thank you all!
FI makes $75k per year, which is great for Oklahoma…but it’s somewhat scary to go to one income! The student loan has two more years…
I will look into Dave Ramsey!
Post # 6
Track your spending right now and then sort into necessary spending and lifestyle spending.
You will be amazed at how much money you are spending on things that are not necessary.
Cut out the lifestyle spending.
Post # 7
@MrsMaskatoBe: Dave Ramsey does have great advice. Good rec by the PP.
I would want to pay off all debts first, and then continue living on one income for as long as possible (and that means trying to save for emergencies, cover all bills, etc, off that one income, bank the other and forget about it). I’d also start checking out jobs that you could do that may let you bring in some sort of income if you’re interested in some outside of the home time or keeping up licensure and edu requirements for if/when you are no longer a SAHM.
Also, try to think long term and worst case scenario and plan for that – health insurance, life and disability insurance, etc. While it can be stressful to try to consider all of these things, it will be a blessing for you if you need to use them at somepoint and you’re already prepared.
Post # 8
^ also just ran across this “How to be a SAHM, when you can barely afford it”. Just browsing through it looks like it has great tips!
Post # 9
By the way, babies are NOT expensive. Seriously, they aren’t. You might have to go without (I use a regular old table for a changing table, or my purse for a diaper bag, for example) or re-adjust your priorities (700$ on a crib is NOT necessary, etc) but don’t be deterred by the “supposed cost” of a baby.
And you’ve already cut out the biggest expense – daycare. 🙂
Here’s a good resource too: http://thepeacefulmom.com/2012/02/20/new-series-living-on-less-than-28000-a-year-2/comment-page-2/#comment-12291
Post # 10
Post # 11
The other piece I would be sure to include in your planning is retirement because your kid is not going to pay for you when you are older.
Even if you are only earning 4.50 an hour, if you need need that to reach your retirement savings goals each month/year, it will mean all the difference in your later years and your happiness.
Figure out what your benefits are, what they will allow you to live with when you retire and what you think you realistically need to retire the way you want.
Also, be sure to have a plan for when you are dont being a SAHM, are you going to continue to stay at home or return to work. If you plan to return to work, how will you do that being 5, 10, 20 years out of the work force? Have a plan in place if that is what you desire.
Post # 12
I am a sahm and I definitely recommend Dave Ramsey! You can do this and it will be an amazing experience for you and your child.
Post # 13
@MrsMaskatoBe: I will be a SAHM and DH makes about the same amount as your FI. We don’t have student loans, but we have DH’s car loan, mortgage and a sizeable amount of credit card debt. Plus the cost of living is very high here in MA. You find ways to make it work, most notably cutting nonessential spending like the PP said. DH is also planning on asking for a raise as he’s been with his company for 5+ years and has taken on a role with a good deal of stress and responsibility.
Post # 14
I would start paying extra on your student loans now. Even $25 a month makes a huge difference. Then I would try to max out your FI’s income to cover your insurance, retirement, and life’s savings. Then factor in having to save for college. It is dooable, but you may need to adjust your lifestyle.
Post # 15
@bebefly: That’s also very true! Little Nike coats won’t keep your child warmer for any longer than a gently used one – they’ll grow out at the same rate. And your sweet little bundle doesn’t know if his diapers are being changed on the snazzy designer baby changing table or a soft mat laid over the top of his like-new dresser. Raising a child is (generally) only as expensive as you make it, like anything else.
Post # 16
@MrsMaskatoBe: http://www.getrichslowly.com has some good tips.
Sounds obvious, but if your husband has habits like buying lunch out a few times a week, or buying coffee each day… anything like that… adds up very quickly. Make sure that he packs lunches for work, brings his own coffee/tea etc.
Differentiate between the needs and wants. Cut down on non-essentials like shoe shopping or gym memberships that are never used. Eliminate costs where you can… bundle services, start using coupons, only food shop once a week and do it with a list (and plan meals). You still want to splurge/spoil yourself with some things, but know what these are and don’t waste money on other things.
Could you get a part-time job? Even if you plan to do this after a few years, like when the kid is school age, then you could look at this as a temporary type arrangement, so when money is tight, it won’t feel like you’re stuck.