Five Tips to Become an At-Home Parent

by Leslie Truex

American two-income families earn 75 percent more than their single-income counterparts of a generation ago, but actually have less discretionary income according to Elizabeth Warren and Amelai Tyagi in their book The Two Income Trap.

The idea that your family earns more but has less may be discouraging unless you are a person who'd like to be an at home parent. The truth is, jobs, particularly second jobs, are expensive. When I worked outside the home as a social worker, I made about $28,000 per year which combined with my husband's income, was a decent income. But we were always broke, running out of money before the end of the month. It seemed like it would be impossible for me to quit my job when we could barely get by as it was. But then I learned about the dual-income myth and when I ran the numbers, I discovered that 2/3rds of my income went to work-related expenses. Of my $28,000 per year income, only $7,900 actually contributed to the family. The rest paid for things so I could work.

If you would like to join the 5 million moms or 3 million dads who stay home, here are some tips to help you afford it.

1) Determine how much your second income costs: When I worked the majority of my income went to taxes, childcare, extra expenses for nicer second car, commuting, work clothes, lunches out, convenience foods and dining out, "I-deserve-this-because-I-work-hard" and guilt items.

2) Determine what you need to live on: Now that you know how much your job costs you, what would happen if you quit? This exercise will show you two things; 1) how short, if any, you would be with one income and 2) areas that you currently over-spend that you can cut back. Do a budget covering ALL spending. Use your bank statements to be as accurate as possible.

3) Cut back on food costs. You can save a significant amount of money menu planning and shopping with a list. You can also save by not buying packaged foods and instead cooking from scratch. Not only will the food taste better but it often only involves a couple extra steps. Avoid dining out including lunches, vending machines, and the coffeehouse.

4) Nickels and Dimes. This is probably the biggest area of excess and waste in most families. Spending a few dollars here and a few dollars there doesn't seem like it would make a big difference. But when added all together, it can cost several hundred dollars per month. Items in this category include things like coffee at the local cafe, magazines, paperbacks, manicures, a quick snack on the way home, etc. The best way to avoid wasting money on the small stuff is to not carry cash or its equivalent (credit cards/checks), shop only with a list, use libraries and barter groups for books, videos and other items, and learn to pamper yourself at home.

5) You can cut back on home and auto expenses easily. Make sure your home is weather sealed (your utility company will likely have tips on this), keep appliances clean and tuned, don't have extra features on your phone, shop for the best long distance based on your use, get minimal cable and use your library to rent movies instead of pay-per-view, and install low flow water faucets to help save water. For your car, opt to get a quality used car that gets good gas mileage. This not only can save you in payments and gas but also on personal property tax, registration and insurance.

For many families, even savvy shopping doesn't completely eliminate the need for extra cash to afford to stay home. This is particularly true when debt is involved. However, if you eliminate work-related expenses, cut unnecessary items from your budget, and learn easy ways save, the income you need to earn should be significantly less than you originally thought.

In my case, I didn't have to replace a $2300 per month income. After I cut out work-expenses, sold my car for a less expensive model, and cut back on household expense, I only needed to earn about $600 per month to stay home.

I could work 40 hours per week at a job for $658 in discretionary income or I could stay-home, work part-time and earn the same. Hmmmmm...what choice would you make?

Earning income from home isn't that hard if you go about it the right way. Do lots of research and heed the experts' warnings about envelope stuffing and other scams. Don't fall for "pay for a job" scams or sign-up to nothing schemes. Working at home is work no matter what work-at-home schemers would have you think. If you do your research right, and choose the right work-at-home option for you, there is no reason why you can stay and work at home.