With cost of living expenses rising, bonuses and pay increases shrinking, many single-income families are toying with the idea of becoming two-income families. However, before you take that job to increase your family’s income, be sure to do your math to make sure you are not increasing your expenses more.
Here are some tips before you make the switch…
Earning Ability: For a spouse who has not worked in years, and who may not have a lot or work experience, earning ability may be quite low. That’s why you need to set an income amount that you must earn in order to make working away from the home worth the effort.
Child Care: Will having both parents work away from home mean that you will incur more childcare expenses? If so, you will need to make that much more money to make the job worth it.
Wardrobe: A new job will very likely mean a new wardrobe. If your closet is already filled with wonderful clothes that are work-appropriate, then you won’t have to worry about wardrobe expenses for several months to a year.
Transportation Costs: How much will you have to pay to get to and from your job? Include the cost of gas or public transportation in your calculations. Don’t forget extra car maintenance costs.
Convenience Foods: With both parents working outside the home, the cost of food will surely increase, as there will be a lot less time to cook.
Guilt Money: Working parents spend a lot more money on gifts and allowances for their children out of guilt. Count on 10% of your money going to your kids for miscellaneous expenses.
While having both parents working can, indeed, raise household bills and possibly not be worth it for a well-run household, by avoiding the pitfalls mentioned above, a second person bringing in a salary could be helpful to a family in financial crisis.
I have been a certified tightwad striving for financial freedom since I became pregnant with my first child — and I decided to find a way to stay home with him full-time. I enjoy sharing my personal experiences in my journey back to financial health and planning for a future — which will include sending 2 kids to college and early retirement.