The Cost of Being a Stay-at-Home Mom

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By MP Dunleavey
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When I was at college in the ‘80s (and a feisty, liberal-arts women’s college it was), the notion of staying home with your kids was, shall we say, unpopular. Why spend four expensive years preparing for your supposedly brilliant career if you weren’t going to put the kids where God and feminism intended them: in daycare?

So it’s been fascinating to watch the pendulum swing the other way the last 15 years, as women of my generation and older faced the untold frustrations of trying to work full time and raise a family. Injuries to the number of women whose heads hit the glass ceiling soared.

In her 1997 landmark book “The Second Shift,” Arlie Hochschild reported that most women who worked full time still did most of the housework. Many others found they were working to pay for child care, so they could keep working—to pay for child care.

No wonder more and more of us began to reconsider the stay-at-home option, or variations thereof (flextime, working from home, extended maternity leave, etc.). As Mary Snyder, co-author of “You Can Afford to Stay Home With Your Kids,” told me, “It’s a total priority shift. Women don’t want the Supermom Syndrome. It looked great from the outside, but once you were in it, you were miserable and you couldn’t excel at anything.”


Making the most of naptime

I’ve ridden the waves of maternal angst with the rest of my peers, and the stay-at-home option has always appealed. Plus, I’m a writer (I said to myself), so I could always work while the little tyke naps. I wouldn’t even have to lose much professional ground. You know: “Writer Wins Pulitzer During Naptime.” Mmhmm.

So I was a prime candidate to get my butt kicked by Ann Crittenden’s new book: “The Price of Motherhood: Why the Most Important Job in the World Is Still the Least Valued.”

A former economics reporter for The New York Times, Crittenden documents in painstaking and depressing detail all the ways in which government policy, the tax code and corporate culture penalize mothers who work and the parents who stay at home. The stats are such a downer I won’t get into them here—but for example, working mothers earn 20% less than working women without kids.

But those who pay the highest “mommy tax,” as Crittenden calls it, are those who choose to stay home.


Cost of giving up a career: $1 million

She uses herself, a writer (ahem), as an example of what happens when women decide to leave the workforce. Most not only forfeit their income, but also retirement savings, pension and other benefits. All told, Crittenden says, she gave up about $700,000. Shocking? Yes. Unlikely? Nope. Economists say that the stay-at-home parent who relinquishes a career may lose about $1 million over the years.

Crittenden doesn’t regret a minute of the time she spent with her son; nor do any of the mothers she interviewed. But the financial tradeoffs she lists are a stunning indictment of a mother’s financial vulnerability. To combat these realities, Crittenden recommends a slew of smart policy changes that would reduce the financial penalty of having kids, especially for stay-at-home moms (or SAHMs, as they’re increasingly abbreviated). But if you, like me, would like to consider staying home before the glacial pace of government acts on your behalf, here are some practical ways to shore up your financial (and emotional) security now.


Reconsider the prenup

Don’t sign your rights away in a prenuptial agreement. Prenuptial agreements are meant to protect the financial assets of both partners, so make sure yours does. By choosing to stay at home, you’re limiting your future income prospects, so make sure any agreement you sign takes into account your somewhat special status as a stay-at-home parent. (If you’ve already signed one and are now thinking of having children, you and your spouse can renegotiate.) Katherine Stoner, a certified family law specialist in San Francisco, recommends the following precautions:

  * Many premarital contracts are boilerplate, so it’s important to weed out any offending clauses. You don’t want to sign anything that waives your right to spousal support or future spouse rights in the event of death or divorce.

  * Get a lawyer to help you plan this, Stoner says. Or you’ll be leaving an awful lot up to chance and the generosity of the courts.

  * Even if the exact details are fuzzy, spell out your future financial plans in the prenup. For example, some couples stipulate that in the event of divorce, since the wife gave up 10 years of her career to raise Jack and Jill, the court should take that into consideration when determining her settlement. You don’t need the details, as long as the intention is clear.


Figure out if you, personally, can afford this

Emotionally, never mind financially, we all have a lot invested in our careers. It’s vital to spend time weighing what leaving the career track will mean. It’s difficult to go from changing sales strategies to changing diapers full time, and many women take a hit in their self-esteem and sense of identity. Luckily, many, many women have done it, and they’ve either formed or joined organizations designed specifically to support your choice.

These resources offer some surprising advice and insights about the new investment you may make., the Web site for the National Association of At Home Mothers, advises you to first have a heart-to-heart your spouse about how this decision will have an impact on your family and lifestyle. They also urge you to be honest about what you need, whether it’s an hour at the gym or time to chat on the phone—and to find ways to give that to yourself. It’s important for you to be happy, they say, “when your lap is the center of the universe.”


Now, can you afford this?

Your initial response, and the response of many two-income couples, might be no. But two incomes can be deceiving. You earn more, but you also probably spend more. When you look at what many SAHM Web sites call “the cost of work”—what you pay in travel, wardrobe and eating out more frequently, plus the cost of child care—your salary may not be the big asset you thought it was. Add to that the fact that your income is taxed at a higher rate thanks to that marriage penalty, and you might be dismayed to see what your second income (or his, if it’s the smaller one) boils down to. takes fictional Julie’s $25,000 per year as an office manager and put it through the wringer of tax deductions and all the expenses of staying employed. Bottom line: “Julie” brings home $6,050 a year, or $2.91 per hour. If you’d like to see how you and your partner’s income play out, use our Second Income Calculator (and have the last two years’ tax withholdings ready to plug in).

Sounds depressing, but it really makes you think: So why not stay home? Author Mary Snyder says that when she left her job as a regional market manager for a Fortune 500 company, she took 45% of the family income with her. And yet, she says, the adjustment was easier than she’d thought. “With two incomes you tend to spend more; with one, you’re smarter about your money.”

A big piece of fat to trim: Many couples, she says, discover that they’re spending more on food than on housing. “Most people can cut their grocery bill by 50%,” she says.


Keep planning for your retirement

You may no longer have a 401(k), but you can put your money into what’s called a Spousal IRA. It has a $2,000-a-year cap, but there are ways to augment that. In some couples, says Stoner, the working partner invests a certain percentage of his/her income for the non-working partner’s retirement. This is important in the event of a divorce—or death.


Don’t assume you’re leaving the workforce

As yet, “Experienced Mother and Architect of Young Lives” doesn’t hold much water on professional resumes. But that day will come. Meanwhile, use your child-rearing hiatus to explore new career options, if you want, or develop your own business. According to Crittenden, 45% of businesses owned by women are based at home.

What in the world could you run from home? Consulting for your previous company is always a good place to start. Want to branch out? Snyder says she’s noticed two up-and-coming areas where women-owned businesses do well: party- and event-planning for adults and children (“Most working couples don’t have the time to plan their 6-year-old’s pirate-adventure birthday party,” she notes), and errand services.

What can you do while you’re jogging all over town with your kids? Do the jogging for someone who’s stuck in an office (remember how you would have killed for someone like that when you were working?): Cart their kids to soccer practice, ballet lessons, etc.

Think of it like this: Instead of you working to pay for child care so you can keep working, customers are working to pay you so you can stay home. Not a bad deal.

Crittenden’s negative portrait of corporate culture aside, it’s worthwhile to find out if your company is more family-friendly than you think. In the last several years, research has shown that it’s in companies’ best interests to help their female workers balance work and career—and some big corporations, like IBM and Deloitte & Touche, have launched new initiatives to help women do just that. Mothers and More, an international support network for SAHMs, offers a perspective I found helpful: it’s called “sequencing”. Instead of taking the view that you stop work and start motherhood, it’s comforting to see it as a series of transitions. The fluidity of this framework is helpful, I think, because a) it doesn’t presume that you’re “giving up” your career, and b) it’s more reflective of the changing rhythms of your life, once kids come.

Millicent MacIntosh, president of my women’s college some 50 years ago, would have championed the idea of sequencing. She was famous for saying that women could have it all, just not all at once. It’s nice to think that half a century later, the world is finally catching up.

The average income lost for a SAHM is $1 million. Here are tips to help you cover the expense.

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