What to consider when deciding to be a Stay at Home Mom.
Affordability. Can I afford to stay home?
- Consider that there will not be the cost of commuting, childcare, meals out, office wardrobe – if you chose to stay at home.
- Look at where your money is going to see what is being spent every month.
- This information will give you the data you need to see what you can afford.
- Plan for being a SAHM by living on one income to see what the financial impacts will be.
Benefits. Where will the benefits come from?
- Review how medical / health benefits will change and if any additional insurance will be needed.
- Life insurance will be important for both parents to ensure monies are available should anything happen to either parent.
- Disability is also important to cover income and expenses should something happen to either parent.
Retirement. SAHM needs to save for their retirement.
- When women leave, they don’t typically save for retirement and they need to continue to do so.
- Spousal IRAs can be funded each year up to $6000 a year.
- Just like a spouse contributing to his 401k, this is also important as well.
- Consider that social security is lower when you stop contributing while at home.
College savings. How to save for children’s education?
- The earlier you start saving for your children’s education, the better.
- Consider presents from grandparents being contributions to 529 plans.
- Do not consider paying for college over your own retirement – since there are options for college funding but not options for retirement.
Going back into the workforce. Make a plan to be employable.
- You may not go back into the workforce at the same level.
- Stay engaged to continue sharpening your skills.
- Consider all you have done while parenting – like volunteering, participating on boards, working with scouts, side hustles.
- You bring a lot of value to the workforce.