Considering the move from two incomes to one?
Many families feel pressure to have two incomes to make ends meet. Conversely, parents in dual-income households often wish they had more time with their children and a less hectic home life.
If you’re trying to determine the right work and family-life balance for your household, start by evaluating the real costs of working. Add up how much you spend on:
· Transportation commuting to and from work each day, including gas, car repairs, bus fare, etc.
· Your wardrobe, dry cleaning and other work-related expenses
· Prepared food and dining in restaurants
· Time-saving services such as house cleaning, snow removal, and lawn care
Also factor how much you pay in taxes and Social Security.
After adding up these costs, subtract the sum from your take-home pay to arrive at your “adjusted” income. You may find you have less to lose than you thought by removing yourself from the workforce.
If you decide that you or your spouse will become an at-home parent or reduce your hours to part time, look for opportunities to limit the financial impact of this choice, such as:
Also, consult your financial advisor to develop a strategy to keep your long-term financial goals on track despite the reduction in your household income.
If you decide that two incomes are essential, look for opportunities — such as flexible hours — that may help give you more time at home. And, if being an at-home parent remains a goal, consult your financial advisor to develop a strategy that will eventually give you the financial flexibility you need to do so.
James C. Hanna, CFP®, MBA, Financial Advisor, Certified Financial Planner ™ practitioner. Advisor is licensed/registered to do business with U.S. residents only in the states of Kansas, Missouri, Colorado, Nebraska, Oklahoma, Texas and Indiana.
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