Ask any stay at home parent, and they will likely tell you that staying home with one's children is not a walk in the park. Along with having to deal with feelings of loneliness, isolation, and boredom, one major challenge that prevents most from taking the plunge is figuring out how to manage living on one income.
When you have two incomes as a family, are paying your bills, and seem to have little money for saving, it can be easy to become disillusioned into thinking that dropping an income would be impossible. You think to yourself, "But, we're barely "making it" as things stand! We couldn't possibly make it with less!" The truth is, and as any stay at home parent will attest, when you have less, you make do with less.
This article offers tips on how to "make do" in order to afford being a stay at home parent.
Now, before quitting your job, it is recommended that you first look at your finances to determine whether stay at home parenting could be possible. While most can make it on one income, there are a few who may not. To help make this determination use Kiplinger's wonderful online calculator. It will allow you to estimate whether you can afford to quit. This determination is made by entering in your monthly income, your fixed expenses, discretionary spending, monthly debt payments, and monthly saving expenses before and after the switch to one income.
OK, so if you can afford to quit, use the tips below. They will help you learn to budget your money on things that you need while making concessions for a few special things that you want.
Cut down your fixed expenses
Fixed expenses are expenses that are predictable and on-going, expenses like your rent, car payment, mortgage payment, student loans, or insurance.
- Home: In today's market, if you own a home, there is a high possibility that you can refinance for lower monthly payment.
- Car: Car payments can also be refinanced given that there are many companie like Capital One Auto Finance and My Auto Loan that are offering great refinancing options.
- Insurance: To save on insurance costs, consider raising your deductibles. If, for instance, your current car insurance deductible is $500, an increase to $1000 will save you 30% more throughout the year. You can also save on insurance by getting new insurance quotes or by bundling your car and home insurance together.
- Student loans: If you haven't already, consolidate your student loans. This will allow you to pay just the principle while paying lower interest.
Get rid of unnecessary expenses
Becoming a stay at home parent may mean that most of all or most of your meals will need to be cooked at home. This, after all, will avoid the costs associated with eating out every week.
Eating out was named as the first expense to attempt to cut, as this is a common discretionary expense of most American families. Nevertheless, there are other unnecessary expenses that are quite common, such as cleaning services, childcare services, gym memberships, haircare services, etc.
Becoming a stay at home parent will force you, by necessity, to learn to do things yourself and be creative. And, these are both good things!
Search for more money!
It's amazing how much money is out there if you have the time and energy to look for it! Consider the following:
- Look for more money on your tax deductions.
- Look for ways to increase your income at work by acquiring new skills and certifications.
- Got old furniture and other odds and ends around the house that are not being used or even coupons? Consider selling them on Craigslist.com or Ebay.com.
- Have a yard sale or bake sale.
Consider family-friendly income opportunities
Being a stay at home parent does not mean that you cannot aim to find job opportunities that will enable you to maximize time with your children while earning some additional money to supplement your family's income. Consider the following, low-time commitment opportunities:
- Babysitting out of your home or daycare. Getting licensed to offer child care services out of your home is a fabulous way to continue staying home while earning an income that could be upwards of $500/week.
- Participating in paid surveys. Some great companies offering paid surveys are: Greenfield Online, NFO Survey Group, Inboxdollars, and Opinion Rewards.
- Starting a scrapbooking service. Scrapbooking is a desired service because most want their pictures and memorabilia scrapbooked but don't have the time to make it happen. Start with your family and friends and begin to advertise your services elsewhere.
Be a proactive shopper
The key to saving money on things like groceries and other household items is knowing what you need before you actually need it and buying when prices are at their lowest. To begin, create a price book to keep track of items that you commonly purchase.
With these tips and some creativity and effort on your part, you will not only survive on a single income, but thrive.
Faye Davison - Faye Davison is a professional freelance writer based in the Washington, DC metropolitan area.
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