I never considered being a SAHM when my children were infants/toddlers because I just knew it would not be a good fit for my temperament and long-term mental health. However, I also knew it would be hard for me to be away from my kids five days a week. Luckily, I was able to negotiate a .6 FTE/3-day a week schedule at the job I had (a professional career in the line of work I received my Masters in), which was the perfect solution for me. I enjoyed the intellectual stimulation and adult interaction of my job without an interruption in my work history, was able to continue to save for retire and live a comfortable lifestyle, and be at home to enjoy the the young years of my children's lives. No regrets about any of those choices.
But it doesn't really matter what worked for me. Maybe negotiating a three or four day workweek would be a good compromise for you, but, it also seems like you really want to be home full-time. If that is the case, and you can afford it, I say go for it.
One word of caution: I think a lot of people think they'll stay home just until their kids start formal schooling and then it will be "easier" to go back to work. Maybe I'm an outlier here, but my life is actually way more hectic now that I have two school-aged kids. I actually can imagine being at home full-time now! So if you do cut back to contract work, or no work at all, I think you should plan that you won't be able or want to go back to any sort of full-time work until your kids are middle or high-school age. Even then, if you've made it that long, it is sort of like, why bother. And once the kids are out of the house hopefully you'll be financially ready so that your spouse can early retire with you!