Staying at home with a child can often be an enriching experience but giving up a salary to be a stay-at-home parent can be hard on the family budget. Over the last three decades, the general trend is that more fathers are deciding to stay at home.
For Stephen and Amelie the decision for Stephen to become a stay-at-home father to their two year-old son was mostly financial. Both parents are federal government employees living and working on the Quebec side of the national capital region. Amelie has the higher government salary of the two; Stephen also earns income running a computer support business, which he will be doing while caring for his son.
“The decision to work from home is a risk because the computer money is not stable and in the government you always get a pay cheque,” says Stephen.
Rob Dempster, a certified financial adviser at Carleton Financial Services Inc., says the family needs to examine how much income will fall with one less income.
“You have to look at what the costs of maintaining the family unit for the twelve months are going to be or what the revenues are going to go down by”
“There is a financial calculation that needs to be done,” says Dempster. “There is typically a strain on the finances.”
ONE-INCOME HOUSEHOLD
Their ability to live off Amelie’s income alone was a major factor in their decision. Stephen says paying off most of their student loans and having regular mortgage payments were important.
“I decided that I do not care about money,” says Stephen. “It is the one time in your entire life that you can spend time with your child.”
“Men staying at home with the child in the first year is a decision between mom and dad. It is sometimes premeditated and thought through from a financial perspective, which I like to think a financial adviser should be brought into the equation,” says Dempster
Stephen says paying off most of their student loans has helped and that they do not carry much debt except for their mortgage payments. They plan on cutting back on utilities.
He says the change will make them think more about finances but that there should not be a cash flow issue. He will continue to work on computers while staying home with his son but the workload is more flexible.
CHEAPER IN QUEBEC
Stephen and Amelie chose to live in Quebec, and not Ottawa, because house prices and transportation costs were cheaper at the time they were looking for a house. Financially, the differences for the family are higher income taxes, transportation costs, and provincially subsidized seven dollar-a-day daycare.
“The actual cost of living in Quebec without a child as versus living in Ontario without a child were about the same,” says Stephen. “With a child we came out well ahead.”
The ball started rolling for Stephen to stay at home after there was an issue with Wilfrid staying in subsidized daycare. Stephen took time off from his work to look for a new daycare. Eventually Stephen negotiated an alternative work arrangement with his manager, which allowed him to work from home for three days a week. Amelie and her mother each covered one of the other two days.
His advice to parents thinking of staying at home is to keep debt low and when at home with your kids, get out of the house.