Personal Finance Tips Weekly

- One of the most hotly debated subjects in modern parenting is whether or not one should stay home with the kids. There are those who say that even having the debate smacks of privilege, since many families and single parents can't afford to opt out of a paycheck. Others say that it's an absolute necessity to have a full time parent on hand, for the children's sake. For the rest of us, there's a messy middle ground where figuring out the right path feels like threading a needle. If you're not sure what's right for you and your family, let's examine some important points.

Point number one, having a parent who can run lead on childcare and family care responsibilities. Pro, it's a relief to have a dedicated resource to make sure these things are covered. When both parents have traditional jobs, tasks like grocery shopping, meal prep, transportation, and school activities can feel impossible to squeeze in. But on the con side, having each parent specialized in the realm of home or work, can create a sense of separation between partners. Point two, cost.

Right now in the US, the average cost of childcare is higher than in-state college tuition. In many places, it takes up around 20% of the median worker's salary, and closer to 80% of that of a low income worker. A stay-at-home parent eliminates this cost and saves on other services a two career family might outsource, such as housekeeping, and prepared meals. The con of course, is if the stay-at-home parent is leaving a higher income job, such that there is a net loss to the family. Number three can be a little harder to quantify, and that's identity.

For many the identity shift from professional to parent can feel like a loss, if you've spend a decade plus building a career, you may miss having colleagues and clients, the thrill of closing a deal, or launching a product, and getting a raise when you do a good job. The daily work of caretaking can feel very different, and the new identity as so-and-so's mom or dad takes adjustment. On the other hand, for people who relish that identity and new community of parents, this is a definite pro. Number four is reentry.

It might be an easier choice to stay home when your kids are small, if there was a clear path of return. Stay-at-home parents hoping to pick up their career where they left off, face tough hurdles, from explaining the gap in their employment, to finding they missed developments in their field. While there are strategies to deal with these cons, like returnships, leveraging volunteer work, or firing up your LinkedIn presence, there aren't really any pros here, sadly. Nor we do we have any rosy pros with number five, risk. Ultimately, one of the major strengths of a committed partnership, is that both people don't have to do and be all things, you can specialize.

This may help the family to function well as a whole, but it also saddles one partner with an outsized share of personal risk, should the relationship end. Time spent out of the workforce may lead to a career long trajectory of earning less and being less prepared for retirement. The days of guaranteed spousal support are long gone as well with family court decisions trending toward more equal custody arrangements, and the expectation that each parent support themselves. Navigating career and parenthood can be a challenge. It's important that each person and family be thoughtful about the path that is right for them.