Hellobee Boards

I'm completely in agreement with your husband. I don't think many look at the soft cash benefits (beyond in versus out money) nor the long term salary investment....10 years out of the work force is a lot of potential

I highly doubt you come back at the same salary in my field....you lose touch with technology too fast

as to reentering the work field at the same salary, i think it depends on the industry and how current one keeps their skills and contacts.

your husband does raise really good points about the finances. i think the decision obviously involves non-financial factors that could outweigh money considerations, like @BandDmommy: mentions.

for me, i never looked into the calculations of SAHM vs. WOHM because i don't have the energy/patience/stamina for SAHM, i make more than the cost of daycare, and we need both our incomes to have the type of lifestyle we want.

At my old job, I didn't have a 401k since I was treated like a contractor and I was covered under my DH's health insurance, so those types of benefit weren't under consideration for us.

We own a business. We have retirement savings, college savings, stocks, all manners of insurance, and my husband makes enough for me to stay home and for us to live very comfortably. I've had well paying, corporate jobs in the past but that life is not for me, as it isn't for many people. I'm fulfilled staying home with our daughter. With my support, my husband makes more money. He's a numbers person and it's been thought through. Not all people want high pressure, high earning jobs. If I felt like I wanted to get a job when children are older, I'm confident I'd have no issue finding something in an area I'd be interested in. I wouldn't be going back to the industries I worked in before.

@Mrs. Lemon-Lime: those are definitely considerations in our situation, although dh would be the sahp. His health insurance for family is way more affordable than mine, although I'm covered at no cost to me through my employer. Also, him moving up in his career is also important to him and taking 5-8 years off while we have kids would set him back very significantly. It's definitely different for me since I would likely be able to renter at the same level or even higher, but not feasible since I'm the breadwinner and have a lot of student loans were paying off over the next 5 years. Also for me, I get a nontaxable student loan repayment given every year I work where I do that will allow me to pay my loans off in 5 years as opposed to 30... that's a HUGE opportunity cost for me.

I agree with your husband on missing out on the retirement savings and increased insurance, but I think it really depends on what field you are in and what kinds of benefits your job provides. I stayed home for 8 months when LO was born and it was an extra $150 per month to add me to my husband's insurance plan, but my sister is on her husband's insurance plan because her company's plan is really expensive. As for the returning to your career - even if you could re-enter the job market at the same salary, you would have missed out on all the potential raises, which could add up to a lot assuming you don't work a job with little to no increases like nannying or waitressing.

@Mae: I think it depends on what the parent who SAH did when they worked. I know several people who worked service sector jobs (waitress/cashier/nanny/etc.) with little to no benefits and they weren't putting anything away for retirement anyway, so it really does make sense for them to stay home.

@Mrs. Lemon-Lime: I guess what I really mean is what a few others have touched on, that there are a lot of people out there who aren't working at the types of jobs where they're making a ton of money/contributing to 401ks etc. (Either by choice/can't hack it (me!)/or because they're not qualified) Those people can still re-enter the work force after 5 years with minimal damage to their earning potential.

I'm sure this is true in many cases. In my case, the lost opportunity cost would be huge if I SAH. I make the same as DH, and full time day care would eat up half my paycheck, but that half already excludes maxing the 401k and my employer contribution. The decision to SAH or not would certainly not be purely financial since it would be an awful financial decision. But as with anything money is not the only determining factor. For me, I think if I were to stay home a year or 2, I could realistically come back to a similar job with a very similar salary, especially if I were able to come back to the same company.

@Mrs. Lemon-Lime: Ok, so here is the long version, lol.

When I was just out of school and began working, I had my student loans to contend with. I also wasn't vested in my 401k, so if I had made the decision to have a child in my early 20s, I would probably not have come out in the black, but I would still have kept working, especially if I could rely on family for a portion of childcare.

The main reason is that there is just such a huge upside potential, if you make it through those first 5 years. The flexibility to have work life balance doesn't come in those first 5 years, it comes when you have experience. I have the flexibility in my job to make my own hours because I have deep expertise in a relatively obscure product offered by my employer.

@BandDmommy: @Mrs. Lemon-Lime: Just wanted to pop in and say that as a spouse, you can take HALF of your husband's benefit he is eligible for... not the full benefit.

This article addresses it very well:
http://www.forbes.com/sites/johnwasik/2014/09/02/social-security-getting-the-spousal-benefit-right/

As long as you have worked long enough to get Social Security benefits, it is based off your highest earning years. You don't "pay into" Social Security, so if you became a SAHM after making $117,000 (the max Social Security earnings), you wouldn't be negatively impacting your benefit.

To answer your question, I agree with your husband, but do feel there are certain exceptions. Overall though I think that it's usually not just a simple financial decision. There are usually emotional components / desires that make the feeling that the paycheck is "erased" more prevalent.

@LBee: thanks! I wasn't sure of the percentage.

@JerricaBenton: "I've had well paying, corporate jobs in the past but that life is not for me, as it isn't for many people. I'm fulfilled staying home with our daughter. With my support, my husband makes more money."

This! I hated the well-paying corporate world and left it to make piddly-squat in academic research. But even that doesn't fulfill me like I know staying home with my children will. No amount of money is worth spending most of your waking hours unfulfilled (as long as you make enough to support yourself which DH far surpasses with just his job - which he loves).

For the most part I agree with your husband. There are huge costs to not working that not everyone takes into account when deciding if one parent should SAH. But the more kids you want to have, and the lower your salary is, the less opportunity cost there is.

@plantains: I fully agree with you.
@Mrs. Lemon-Lime: I make enough that my salary more than covers daycare, but if faced with only a little take home pay, we would still decide daycare. LO loves daycare and learns so much. She surprises us every day, as we tend to underestimate her learning abilities. She has best friends and comes home with all kinds of stories about them.

Not every employer even offers insurance, pensions, matching 401ks etc. So, pretty likely that if a paycheck isn't covering daycare- most of those opportunities might not exist. I do think sah is a huge sacrifice however, not just in terms of the obvious like retirement contributions.

I just wanted to bump this because it was an interesting read.

I agree with your husband... but there is always more to the equation than just money.