Last week I learned that my family’s childcare situation is coming to an end once again, so we are scrambling to find quality care for my 1-year-old daughter. This is the sixth time during my daughter’s short life that we have found ourselves in this position. It is extremely stressful, and each time we go through a change, it brings up the same question: Why don’t I just stay home?
It’s a valid question, especially considering the expense and scarcity of childcare in Seattle, where we live. I know plenty of other parents who have opted not to work outside the home, and I understand and respect their decisions.
But as I examine my own situation, I find that as much as I cherish spending time with my daughter, I also enjoy my work.
And being in this line of work, I naturally made some financial calculations. I knew I needed to do more than just compare my paycheck to our childcare bill. I also had to factor in lost wage growth and lost retirement assets, including retirement plan savings and the effect of lost earnings on my projected Social Security income.
I used an interactive tool created by the Center for American Progress (CAP), which helps families calculate the financial tradeoffs of being a stay at home parent. Plugging in my information showed me that the total financial cost of my staying home for the next four years, until my daughter is school age, would be nearly six-and-a-half times my annual salary.
These results supported my decision to keep working. Paying approximately $22,000 per year for childcare is a substantial expense, but the costs of not working would be far higher.
Of course, going back to work or remaining at home is not just a financial decision. There are many unquantifiable benefits to staying home with your children. Personally, I enjoy my career, and I’m not sure I have the right temperament to be a stay-at-home mom. But for others, not working—or finding a flexible work arrangement—may be the best option.
In any case, whatever your choice, be sure you make an informed decision by understanding the true costs of taking time off.
CAP has released an informative brief on the childcare affordability crisis and the costs of interrupting a career.