Author Topic: Should I go back to work after being a SAHM?  (Read 3988 times)

SAHMcarol

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Should I go back to work after being a SAHM?
« on: April 27, 2016, 06:10:34 PM »
Hey Mustachians, I need your opinions!

I found the blog this week and started devouring it; I'm happy to report I've been living a mostly Mustachian life to this point. I worked all through University, paid my tuition and costs myself, paid off my student loans before graduation, paid cash for our wedding, honeymoon, car and subsequent mini van, and saved for a down payment on a house. I left work at age 25 when my first child was born. 6 years later, I now have 3 kids and stay at home with them. My husband has been in the Canadian Army for the last 9 years and has supported our family on his single (yet humble) income. I am very money conscious and pay off credit cards in full each month and have no debt except mortgage. I eat out once a month, buy healthy food, buy used, sell my used goods, and live frugally.

Unfortunately, the part I've failed miserably at is retirement savings. We do not have RRSPs, our RRSP and 10k emergency savings were completely eliminated during a very rough 2 year financial hardship period, and our only retirement contributions are through my husband's pension adjustment that is automatically taken off by the army. My husband will not be in the army 25 years so it will be paid out to us when he resigns and he will not receive a pension. So, my question to you is this: Should I go back to work instead of being a Stay at Home Mom, and pour all earnings into a retirement plan so we can both retire early, or at the very least, comfortably? My going back to work is the only way for us to save extra because our income and budget is already tight, but it would require me to spend half my salary on childcare & travel. My field of work is not high paying either, so it would be a lot of effort for minimal reward.

Thank you kindly for your time, I am open to questions & advice.

bobechs

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Re: Should I go back to work after being a SAHM?
« Reply #1 on: April 27, 2016, 06:19:37 PM »
Yes, you should.

When I was growing up my Dad was in the USAF and my Mom sometimes was at home and sometimes worked.

From my point of view as a kid, things were better for everyone when she worked.  Hardly ever in these endless rag-chewings on the subject does anyone ever other than assume the kids must desperately want (or need, anyway) one parent (maybe both) at home at all times.

It's bullshit.  Parents assume because they want it it must be good and necessary for kids.

It didn't tear me up when my Dad was on TDY or remote assignments either.  I knew he was coming back and so did he, and my Mom.  Except Vietnam.

mxt0133

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Re: Should I go back to work after being a SAHM?
« Reply #2 on: April 27, 2016, 07:38:47 PM »
For me the numbers always helps.  Figure out what you expect to earn if you go back to work.  Subtract out taxes, childcare, commute, and any other expense that you might add for having to work and be away from the household.  Then figure out if the extra money is worth it.  It might be meager now but remember you will eventually get raises and compounding will have a much larger effect over time.  So if you can only put in 5K a year(assume you are 21) now vs in 10 years(when you are 31), at 6% interest rate you would need to invest close to double or 10K a year to end up with the same a mount when you retire (start at 21 to 65).  Also ask your husband to contribute more to if it will help the number look better if you go back to work.

Another thing to consider is once the kids are older and you don't need expensive childcare anymore that's when you can really start saving but you would have to be willing to work longer and ER will not be so early.

These questions come up a lot here and one thing that is never considered is what do you value more, being there ALL THE TIME for your kids now by not working or not relying on your kids financially when you get older because you were able to save more.  This might not be a concern for you because you are in Canada with better safety nets.

This was a consideration when my wife stopped working after kids. However instead of choosing to delay retirement savings,  we gave up the house and white picket fence for her to be able to stay home and still keep a high savings rate.  When she goes back to work then we might put the house back on the table.

asiljoy

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Re: Should I go back to work after being a SAHM?
« Reply #3 on: April 27, 2016, 10:44:37 PM »
Do you miss working? Did you love your career?

It sounds like you save your household plenty of money by managing it well and it's doubtful you'd be able to put the same amount of effort to go into that once you're working full-time; be prepared for overall household costs to go up as well.

Pigeon

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Re: Should I go back to work after being a SAHM?
« Reply #4 on: April 28, 2016, 04:23:37 AM »
I would. But I would loathe being a SAHM and think that is is dangerous for any woman to be dependent for any length of time.

 If you are naturally frugal, your household costs shouldn't go up very much. You just have to be organized and efficient. I also think many women short change themselves by not looking at the longer term implications on their earning power by staying out of the workforce.

ender

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Re: Should I go back to work after being a SAHM?
« Reply #5 on: April 28, 2016, 06:37:05 AM »
If I read your initial message right, you currently have three kids under six.  And you mentioned you would pay half your income out in childcare and transportation.  To me, that doesn't sound like a worthwhile tradeoff -- kids are likely to get sick more when in full time care, and that can be REALLY hard to cover on a low wage, most likely low flexibility job.  Maybe once you have two in public school and just one in full time care the cost/benefit ratio will be significantly better.

+1


Lucky Girl

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Re: Should I go back to work after being a SAHM?
« Reply #6 on: April 28, 2016, 11:36:56 AM »
Yes, you should do some form of paid work to help your family AND to provide yourself with some additional financial security should something bad happen.  This may be less of an issue in Canada, but you would still be in serious trouble if you and your spouse decided to split. 

But do you have to go back to full time work at low pay?  Are there part time jobs you can get now that will keep you in the workforce and update your resume, with an eye to full-time work in the future once the costs are lower? The answer here may be no, but it is worth considering.  I stayed in the workforce when my kids were born, but was able to dial back to part time for three years.  When I decided I wanted to ramp up to full time for more money, it was very easy.  I think it would have been impossible for me to get the job I have now if I had completely stayed home for three years.

mm1970

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Re: Should I go back to work after being a SAHM?
« Reply #7 on: April 28, 2016, 01:48:18 PM »
Hey Mustachians, I need your opinions!

I found the blog this week and started devouring it; I'm happy to report I've been living a mostly Mustachian life to this point. I worked all through University, paid my tuition and costs myself, paid off my student loans before graduation, paid cash for our wedding, honeymoon, car and subsequent mini van, and saved for a down payment on a house. I left work at age 25 when my first child was born. 6 years later, I now have 3 kids and stay at home with them. My husband has been in the Canadian Army for the last 9 years and has supported our family on his single (yet humble) income. I am very money conscious and pay off credit cards in full each month and have no debt except mortgage. I eat out once a month, buy healthy food, buy used, sell my used goods, and live frugally.

Unfortunately, the part I've failed miserably at is retirement savings. We do not have RRSPs, our RRSP and 10k emergency savings were completely eliminated during a very rough 2 year financial hardship period, and our only retirement contributions are through my husband's pension adjustment that is automatically taken off by the army. My husband will not be in the army 25 years so it will be paid out to us when he resigns and he will not receive a pension. So, my question to you is this: Should I go back to work instead of being a Stay at Home Mom, and pour all earnings into a retirement plan so we can both retire early, or at the very least, comfortably? My going back to work is the only way for us to save extra because our income and budget is already tight, but it would require me to spend half my salary on childcare & travel. My field of work is not high paying either, so it would be a lot of effort for minimal reward.

Thank you kindly for your time, I am open to questions & advice.

It depends!

You've got 3 kids (6 and under I assume).  Working with little kids is hard.  Being a SAHM is also hard. 

- What type of work will you do?
- What hours will you work?
- Will you work full time?
- Where will your kids be when you are at work, and what will this cost?  (Can you afford child care for 3 children?)
- What kinds of shortcuts will you take when you are out of the house for 8+ hours a day?

Gotta run the numbers.  For many of my friends 3 kids in daycare is the tipping point.  At one point my friend was taking home $100 a month after child care expenses.

ETA: I did some math in my head on my lunch time stroll.  My take home pay (after taxes and childcare) is about 50% of my gross pay.  But that's still low $50k.  If it were half that I'd probably reconsider working.
« Last Edit: April 28, 2016, 03:29:28 PM by mm1970 »