I am a Stay at Home Mom. Here’s How I Finagled My Finances to Make It Happen.

The biggest decision Husband and I have made regarding our lifestyle and finances was for me to stay home with Son. That meant a 50 percent cut in our income, but we thought about it quite a bit before Son was even a twinkle in Husband’s eye, and we planned ahead.

Here’s how we made it happen:

1. We did the math. We thought out what expenses we’d be able to cut/save if I stayed home and which would go up. Daycare was easily the biggest expense we’d be able to forgo. We’d also save on gas to and from work, eating out (lunches and dinner) dry cleaning and income taxes (hello lower tax bracket!). We’d see an increase in electricity, water and groceries (now that I’d be cooking more), not to mention all of the new expenses for the baby (healthcare, food, diapers, etc.). Having more than one child can have a huge impact, too. My income was such that we’d still be losing a huge chunk of income, but for some people I know staying home made very little difference in their bottom line. Check out this great second income calculator to help you figure out how much your second salary really brings.

2. Cut unnecessary expenses. I stopped getting my nails done and cut out my daily Dunkin’ Donuts coffee stop. We both started bringing our lunch to work more, and we looked to cut our cable bill and other bills to get what we wanted, but not more than we needed.

3. Started to live just on Husband’s income. Since we knew we wanted to start trying for kids right away we began doing this a few months after we were married (I wish I’d started sooner). We did (do) dip into it occasionally, but we wanted to get used to the idea of living just on his income.

4. Changed our insurances. Instead of the better PPO health plan we went with the HMO, saving us several hundred dollars per month. And we pray for no serious health issues.

5. Paid off or set aside money for big recurring expenses. While I was still working we paid off some life insurance we had so we wouldn’t get that bill when I wasn’t working, and we got a discount on the premiums by doing so (and an extra tax bill, but still worth it). We set aside three years’ property tax payments and a few other once-a-year payments (just in case).

6. Made sure cars and appliances were in good condition. We didn’t want to be saddled with a car payment or large appliance replacement at least for the first three years. We had our mechanic check our cars (which were paid off), bought a new dishwasher and set aside money to replace our AC unit (we did have to replace it) and our dryer (still kicking).

7. Decided to stop adding money to retirement plans. Except for Husband’s 401k (he gets matching funds, and we never throw away free money), we stopped contributing to our IRAs. We decided we’d likely need the money to live on, and when son went to school and I started working again during school hours we’d be able to make up for the lost time.

8. Get more freelance work. Husband is a graphic designer, an occupation very conducive to freelancing. This extra income would (has) allow us to make up for any shortfalls, and give us treats such as vacations and iPods and flat screen monitors.

9. Found alternative sources of income. When opportunity knocks we invite it in. I find bargains and re-sell them, take surveys, participate in market research, and took a temporary job working for Husband’s Uncle (very lucrative, but only lasted a few months, dadgummit!). A friend of mine makes extra money providing after school care for neighborhood kids. We also speculated that Husband would be getting a raise or two, but we didn’t count on it. He has gotten several raises and bonuses (though his Christmas bonus this year was a bit unsatisfying), and they’ve certainly helped!

Thanks to this plan we were able to put much of my salary into savings, creating a nice cushion for what we knew would be “the lean years”. Now, nearly four years later, it’s been a rousing success.

If becoming a Stay at Home Mom or Dad is what you want to do, take a look at your own life and see what’s possible.

I highly recommend it.

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12 Responses to “I am a Stay at Home Mom. Here’s How I Finagled My Finances to Make It Happen.”

  1. Lisa Says:

    Definitely great advice!

    I feel I must do my part, though, and point out the large amount of compounding you are missing out on by not saving for your retirement now… even just a little bit. $20 in the bank now is way more powerful than $50 later. Or something like that.

  2. Lee Says:

    Some great comments – but I must add that we tithe too. Giving ten percent off the top to church/charity – miraculously stretches the rest and great opportunities for financial increase manifests.

    Your husband’s matching 401K is brilliant too.

    John 10:10 says “I have come that you have life and have it more abundantly.”

    We decided long ago that if we put God first, we could have better opportunities and make better choices….

    We were right… Thanks for your blog!

  3. Aaron Stroud Says:

    @Lisa, it’s true that when it comes to saving for retirement sooner is always better, except when sooner requires sacrificing our kids. Many families manage to save for retirement and keep a parent at home to care for and educate the kids.

    @BeThisWay, you made the right decision and your kids will really appreciate it although there will be times when they claim they don’t!

  4. The Paragraph Edition | Festival of Frugality 122 | On Financial Success Says:

    […] quest to define frugal is an old one, but is still very relevant to modern life. One stay at home mom discovered living a frugal life allowed her to remain home with their son. Others seek to trim […]

  5. Monroe on a Budget » Festival of Frugality 4/22 Says:

    […] You Going to Be This Way The Rest of the Time I Know You presents I am a Stay at Home Mom. Here’s How I Finagled My Finances to Make it Happen: “We thought out what expenses we’d be able to cut/save if I stayed home and which would go […]

  6. Mrs. Accountability Says:

    Excellent planning! Something I wish would have worked out for me as a youngster. It will always be worth it, to be there for your little ones. Careers can always be had, but they grow up so quickly.

  7. Frugal Babe » Archive » Carnivals and Festivals Says:

    […] Success this week.  Right off the bat I saw a post I liked from a stay at home mom who has figured out how to be just fine on one income.  Quest for Four Pillars has a great post about what constitutes a “decent” life – how […]

  8. Monday Evening Linklet « Are You Going To Be This Way The Rest of The Time I Know You? Says:

    […] Festival of Frugality hosted at On Financial Success included my article I am a Stay at Home Mom. Here’s How I Finagled My Finances to Make It Happen. I really hope that other men and women who want to stay at home can find a way to do […]

  9. Everyman’s Guide to Decreasing Expenses Says:

    […] your job. A common idea in many blog posts is whether you’re further ahead or not having a second parent work. Crunch the numbers and see if you might be further ahead staying at home instead of […]

  10. MomofTen Says:

    For any mother who feels they must do their part……. You are doing MORE than your part by staying home if at all possible, and raising your own kids. If you can add some $$ to the pot by doing something at home, great ! If not, don’t feel guilty. After all, you are doing a huge job by raising the little ones as YOU want them raised, being their for them at all times, and the house chores as you know are endless. You can give hubby a break by requiring less of him when he comes home exhausted from a hard day at work. Way more rewarding than going to work every day and sending the kids to the kennel………..

  11. Side jobs, side worries « Funny about Money Says:

    […] Be This Way describes how she and her husband arranged to make it possible for her to knock off work. On the other hand: she has a spouse who’s earning a living. I have no one. And SDXB has been insisting for years that Bumhood is feasible for anyone who’s determined to make it work. But: he has a military pension and gets twice as much SS as I will get, on top of his savings. He lives in Sun City, where housing costs are a fraction of mine, taxes are a third as much as mine, and insurance is half of mine. And his idea of “normal” is most people’s idea of “ascetic”—he lives an Extreme Frugal lifestyle as a matter of course.  […]

  12. Another moment of fame « Funny about Money Says:

    […] more than he spends) surfaces here, as does Be This Way’s reassuring and interesting story of how she and her husband make it possible for her to be a stay-at-home […]


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