(Closed) Low Income SAHM's.

posted 5 years ago in Parenting
Post # 136
Member
7977 posts
Bumble Beekeeper
  • Wedding: July 2013 - UK

franklyn:  Pounds. I realise that this can be misleading. The best way to think about it is in terms of spending power… a dollar in the US generally buys you what a pound would buy you in the UK, even though a pound is worth more. There are exceptions… petrol is much more expensive in the UK, taxes are higher… but we have an NHS (which makes a huge difference). Because of the NHS, private healthcare is much cheaper.

Spending power is a hard one to suss out. When I used to live in Malaysia, it was 5 ringgit to the pound (roughly) but a ringgit had the same spending power as a pound much of the time… a newspaper would cost 1 MR in Malaysia and £1 in the UK, for example. Again, there were exceptions… the cost of transportation was much higher in Malaysia if things were taken on a ringgit = pound basis.

Post # 137
Member
443 posts
Helper bee
  • Wedding: August 2014

Rachel631:  Yes, but another way to look at it this:

Rhe median household income in the UK is 38547 pounds, which you are above. In the United States it is 44389 dollars, which this couple is below.

This is without accounting for the fact that in the US a simple birth can leave a couple with $4000 in hospital fees, or that there are programs such as child benefit in the UK that help parents. 

Post # 138
Member
7977 posts
Bumble Beekeeper
  • Wedding: July 2013 - UK

franklyn:  We aren’t above £38,547…. I assume that’s after tax, because the average single income is around £26,000 before tax… making the average income for a couple £52,000 before tax.

We’re below that. Quite a bit below. And we live in one of the most expensive areas in the UK.

We wouldn’t pay hospital fees on a birth, nor would we receive child benefit.

Post # 139
Member
3181 posts
Sugar bee

OP, start saving now and I think you’ll be fine for a year.

By The Way, no one mentioned that breastfeeding may not work out for you. I know women who 100% wanted to breastfeed but couldn’t for various reasons. 

Post # 140
Member
443 posts
Helper bee
  • Wedding: August 2014

Rachel631:  Each couple making under £50,000 is qualified to receive 82£/ month for the first child and a bit less in addition for following children, so you would receive that if you had children. As well as other programs such as housing benefit ect. The United States doesn’t have the safety net that you do, which is why posters were so worried about the OP having kids on 30,000c Also you wouldn’t have to worry about medical bills, as I pointed out, but they would. Also I doubt they could afford health insurance, which is crazy expensive in the us. Also Americans need to save more for retirement, they get less from the government than you would.

Both the stats I quoted were the median before tax income of households made up of two adults without kids In 2012. 

It’s interesting that you pointed out that for one person it’s 26,000£. It’s the same in the USA, for one person its 32,140, which times 2, is higher than the median household income.  I’m not sure what it is about couples that make it so they earn less. Potentially it’s could be because one partner is staying home or working part-time? Or both are less pressured so they work less overtime? I don’t know. Women do tend to earn less than men, so this could be one of the reasons. 

I’m Canadian, my situation is a mix of th two. I don’t need to worry about health care, but we don’t get the other support you do from the government. We make 60,000 combined, and in the highest cost of living city don’t feel comfortable having kids. We can’t afford it. There is no way we could ever afford to buy a house or even apartment, a kid would take away any saving ability we have. 

Post # 141
Member
3221 posts
Sugar bee
  • Wedding: September 2016

Rachel631:  I’ve lived in the UK and in North America… The buying power of a pound is NOT the same as a USD. The exchange rate is pretty accurate, usually it hovers around 1.4 and I would say what you could buy for a pound in the UK you would spend $1.40 in the US. Some things don’t translate – eating in restaurants is spendy in the UK – but then you can’t spend $5 in any random convenience store in the States on a sandwich, drink and side dish for lunch and get change.

 

 

I also think that the median income in an area reflects to some extent a cost of living: for example, you simply can’t buy a house under a million within an hour and a half of downtown Vancouver… So for people to live there incomes are higher without the standard of living changing significantly from, say , Vancouver Island where houses are a bit cheaper.

 

renting in a high cost area is still expensive too – the mortgage on that property still needs to be paid.

Post # 142
Member
7977 posts
Bumble Beekeeper
  • Wedding: July 2013 - UK

franklyn:  It’s true that we would be eligible for child benefit, but we probably wouldn’t take it.

We aren’t eligible for any other programs, and housing benefit certainly wouldn’t apply.

The big thing is probably the NHS, which is free for us (thank goodness).

I think that our combined income before tax is probably somewhere around £42K, currently…. more than DH’s parents raised 3 kids on…

Post # 143
Member
443 posts
Helper bee
  • Wedding: August 2014

Rachel631:  Why wouldn’t you take it? In canada we could get something similar, though much less. If your eligible and file taxes, it’s dome automatically here. There is no way to opt out.

Are there class connotations with rceiving the benefit? I’m an political economist, so I’m always curious about these things! 

Post # 144
Member
7977 posts
Bumble Beekeeper
  • Wedding: July 2013 - UK

babeba:  For comparison then…

A pint of semi-skimmed milk is about 50p.

A loaf of bread is about £1.

A packet of sandwiches is about £3.

A litre of fuel is about £1.39.

What would be the comparable US prices?

franklyn:  It’s sort of a class thing, but I would say more of a guilt thing. People feel funny about taking it unless they are really quite poor…

Post # 145
Member
443 posts
Helper bee
  • Wedding: August 2014

Rachel631:  Thanks for answering, that’s interesting to know.

Those prices look low to me!

500g milk is about 1.5 canadian dollars, bread  is about 4, at at a grocery stone a sandwich would be about 5, but only one and not a fancy one at that, gas is similar though, for a liter I paid 1.45 yesterday. 

Post # 146
Member
3221 posts
Sugar bee
  • Wedding: September 2016

Absolute-value for food – I probably spent about $100 Canadian (at least) less on food when living in the UK than I did when I came back to Canada. In Canada I shopped for deals more; in the UK I often splurged by shopping at Marks and Spencer’s or Waitrose.  It was much easier to get around without a car there, so that saved a ton of money.  I wasn’t in London, so my rent was cheaper than here as well. 

franklyn:  Rachel631:  

 

I still think it is impossible to compare prices between more than, say, 5 years ago and now because of changes in the price index and inflation.  You really do need to use an inflation calculator.

Post # 147
Member
2692 posts
Sugar bee
  • Wedding: November 2012

We don’t make much but I still manage to stay at home with 4 kids and we make it work.  We own our house outright so we don’t have a mortgage, which helps.  We save on bills as much as we can… we don’t use  much electricity, we have basic cable and I have prepaid cell phone (I don’t use it much so it works for me).  We are lucky enough that my fil pays our internet and water bills.  Our grocery bill is roughly about $250-$300 a month (give or take).  And I try to cook at least 5x a week so we save on eating out (I pack my hubby’s and the kids lunches).  We save for extras that we want, like birthday parties (which I like to start planning early) and vacations.  We just went on a long weekend with the family to a hotsprings resort.  We also manage to put my daughter in gymnastics (she goes every saturday).  And we’re about to put my son in Tae kwon do.  

Now we had to forgo things like private school and a newer, bigger vehicle for the time being.  But dh is moving up in his job so financially things will start looking up plus I would like to work from home eventually once the baby gets a little bigger to add to our income.  

I know how to budget and stretch a buck… I have been a sahm for many years so I know how to roll with the punches and work with what we have.  Now we don’t have much savings, which can suck, like spending almost $500 of dh’s check to fix his car.  We do live check to check (well, dh more than me…. since I have to deal with the household bills and school related stuff I tend to know how to balance out our budget since dh gets paid every 2 weeks.)  He also makes less now than he used to but we’re making it work because I love staying home and would not want it any other way.

Post # 148
Member
5219 posts
Bee Keeper

FutureMrsB123:  OP, I know this thread has died down. But this article reminded me of this topic:

 

http://finance.yahoo.com/news/report-cost-raise-todays-child-tops-245-000-120158118–finance.html

 

Basically stating that just in the past year, the average cost of raising a child rose 1.8 % and is roughly 245k from infancy to adulthood for middle income families in America when you factor in basic needs, food, healthcare and education.

Post # 149
Member
459 posts
Helper bee
  • Wedding: June 2013

FutureMrsB123:  I think… this will be doable but very challenging. We are in a similar position ourselves. Darling Husband make $64k a year at the moment, so more than your income would be, but we live in Orange County CA which is a pricey place to live. It was NOT in our plan to get pregnant right away, and we had been planning to be married 3-5 years before having a baby so we could save money, enjoy our time together, and pay off most of my student loans. However, I got pregnant after us being married for 9 months even though we were doing everything to avoid it. I am also working full-time, though my income is low (full time at $15 an hour.. not sure income-wise) and that money goes towards our savings as well as paying off my student loans. Thankfully, both our cars are paid off and we rent, so my $30k loans are the only debt we have. We pay extra amounts toward them each month in order to pay them off faster, and live on a budget which allows us to save $1500 a month, though it isn’t as “fun” as before. I spend $200 or less a month on groceries, household supplies, etc. and that is a challenge. When the baby comes, I won’t continue working because day care in our area is so expensive, it means I would hardly be making any money beyond that expense, so I may as well stay home. On my husband’s salary, we can live in our curent place, on our current strict budget, and still save a couple hundred a month/have that on hand for any emergencies. We will have $22k in savings by the time baby arrives, and we plan to maintain that and add to it as we are able, but at the least, maintain it.

We aren’t too worried financially because we are both very frugal and still have a wonderful life. HOWEVER. The reason we can afford to not be too stressed is that my husband’s job has many pay increases which are guaranteed to occur over the next few years. In 2 more years, he will be making $100k. (If your husband is thinking of going back to school, I highly recommend accounting, and then busting your butt to get into one of the Big Four firms. That’s what Darling Husband does, and while pay isn’t fabulous at first, it is exponentially great as time goes on, making roughly 6 figures by your fifth year). So while things are tough now, the baby won’t remember and his life won’t be impacted, because he’s… a baby haha. By the time he is old enough to remember, we will be living still frugally, but then it will be because we bought a house (our 3 year goal from now). By the time he is old enough for extracurriculars, we will be nicely nestled into the middle class of Orange County, which is a great spot to be.

I also think you need to be careful how much you rely on things such as “for sure” cloth diapering, breastfeeding, and working until the day you go into labor. I originally wanted to cloth diaper, but we decided to move into a cheaper apartment closer to our families (we were living a bit further in a very nice apartment, small one bedroom with washer and dryer) which means we get a second bedroom, yay!, but also that we no longer have a washer and dryer. Most affordable apartments don’t have a washer/dryer in the unit. Laundromats don;t allow you to wash cloth diapers there, because… gross. I don’t mind using MY appliances with MY babies poop, but I don’t want to wash my clothes in a public appliance where a stranger’s poop has been. Our apartment laundromat has the same rule. And I will not be toting poop diapers to my parents or in-law’s to use their washer and dryer, because that’s like a daily or every-other day task. For breastfeeding… what if your supply is too low? What if baby hates breastfeeding? What if your milk just never comes in? Then you will be forced to pay for formula. And what if you go into pre-term labor, or have any other health condition that forces you to go on bed rest? Then how will you work? Plus, if you have to have hospital bed rest, that can be very expensive.

I think if you can budget and make it work with ALL these things included… an expensive emergency delivery, a NICU stay, disposable diapers, and formula, then go for it, but just know that kids aren’t cheap and they don’t get much cheaper as they get older because they will need things, and want things, and you’ll want them to have fun (sports/band/dance/etc) experiences as well.

Post # 150
Member
1172 posts
Bumble bee
  • Wedding: April 2011

I agree with the pp about assuming cloth diapering and breastfeed will work for you and baby.  I would plan to budget for diapers and formula and if you don’t need them it’s a bonus.  We live in Texas and make about $100,000 combined and it’s still a stuggle sometimes with a 14 month old (that also includes a house payment, 2 car payments, 401k contributions, insurance, student loan payments, bills…).  And I also agree about the hospital/delivery fees plus all the doctor vists – I think in the first year we had 8 or so required check ups plus a couple sick visits.  But you can also buy a ton of stuff at resale stores and save a lot of baby gear and clothes or if you have friends or family with hand-me-downs that will help too.  There are ways to make it work, but I would suggest budgeting for more than you expect.

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