2 August 2007

Living on one income

Can a family do it?

There is a common understanding in contemporary Australia that it’s financially wise for both husband and wife to work. While I believe that is true when there are no children in the marriage, I don’t believe that’s necessarily true for all couples with young children. When you add up the actual cost of having both parents in the workforce, when child care costs are in the equation, and often when they are not, it’s often financially sound to have one parent at home. And when I say “parent” I mean either the mother or the father. The partner who can earn the most money, for the least expense and the shortest time away from home, should be the one who goes out to work.

The actual costs of earning a living are those that might be hidden or forgotten about. Some things to consider are whether you will go into a higher tax bracket, day care or babysitting costs, transportation, fuel costs or running a second car, clothing for the new job, equipment needed or tools of the trade, cleaning costs for clothes, grooming in the form of haircuts and cosmetics necessary for your level of work, lunch at work, all those lattes and espressos, magazines to read en route to work and at lunchtime, bottles of water and the added cost of food at home when you start buying convenience and pre-packaged foods. When you calculate all those factors in, many people find that they are working for less than the basic wage.

You should factor in related matters too - those factors that will lessen the impact of one parent not working. When one parent is at home with the children, their job is to look after the day-to-day needs of the children and to save money in the home. When one parent is home they can shop for grocery bargains to make the most of the food budget, food can be cooked from scratch and they can bake bread – this is the healthiest way to cook and it’s also the cheapest. When one parent is at home they can grow vegetables and have chickens for eggs. If there is surplus in the garden they can preserve the excess for eating later in the year - again saving money. Clothes can be sewn and knitted and in general, there will be time to look after the things you already own.

When one parent stays at home with the children, you can read to them, teach them how to write their name, tie a knot, how to count and identify colours. You could teach them to garden, bake cookies and boil eggs and you could show them, by example, what a joy simple living can be. You can be there when they come home from school, or homeschool them, and you can watch them grow to their true potential. Value comes from many things apart from those with a dollar sign attached.

This is one of those decisions you need to make with your partner before have children. It's better to go into your big life changes having already discussed them together and knowing what each other wants. I think the ideal, which is not always possible, is that you both work hard when you first marry to save for the deposit on a home and then to pay off as much as you can on your mortgage. When your babies come along, you can start on this next stage of your life - raising your children within a strong and loving family where both mum and dad have a good balance between family and work.

So if you're thinking about taking on a job sit down and work out if it will really be worth it. For instance, if your new job will pay $500 a week you might pay $150 of that in taxes, making your take home pay $350. You have to get to work so you spend $50 a week on public transport or running the car. Your $350 is now $300. Child care costs $100 a week, so now your income is $200. Take off the amount you need to spend on clothes and grooming, your coffees and lunches and you’ll soon realise that working when you have to pay childcare is sometimes a no-go zone.

As you can see, it's not straight forward and you need to think about what you get from working as well as what you'll give away. There is no doubt that working together to pay off the mortgage is a good thing to do, but your first priority as parents is to your children and you may find there is more value in having one parent be with the children to guide them through childhood. No matter which way you go, when you think about it and talk to your partner and then make your decision, make sure you do everything to make that decision work for your family as a whole. And if you're sure that your decision is the best for your family, work towards your goals together with no guilt and no regrets.

Tomorrow I will continue this theme with - Transitioning to a single income.

As always, I'm interested in your opinions and comments. If you've had experience with this one way or the other, please let me know how you coped.



  1. I was fortunate when I had my first child to be able to take time off from work. While I was on maternity leave I waas offered and took a redundancy package. This money enabled me to stay home for two years with my daughter (this was also when interest rates were up around 13%). After 2 years when money was getting a bit tight I returned part-time to the workforce. My daughter went to acombination of family day care and a formal community run creche for the three days a week I worked. I fell pregnant with my son about a month later. As I had only just started a new career I was not eleigible for paid maternity leave. My son was a good sleeper and as a result of severe reflux also ended up being bottle fed. I returned to work once he was 3 months old. This was all during the early to mid 90's my son was born in 1996, my daughter in 1993. I know child care costs have risen like everything else since then. I hae always tried to be frugal and working part-time gave us that little bit extra income to pay our mortgage. 7 years ago I got divorced so went back to single income. I still try to live a frugal life and still work part-time (roughly 30 hours per week). I also have 50% shared custody of my children which means I can balance my work and family life.

    There is no easy answer but I agree with Rhonda when she says you need to work out the cost not only in $$ but also in family time. You can't buy back time with your children. Working part-time allows me to balance my time. Up till this year I have always been home when my children come home from school. I am also fortunate that I work locally so I am only 5-10 minutes away should anything happen to them.

    Good luck everyone with finding your balance and thatnk you Rhonda for your thought provoking post :)
    take care of you.

  2. I definitely agree that it's a good idea for one parent to stay at home. As I work more with kids, I realize just how important it is for kids to realize that they DO come first. However I also realize that for some people, timing wise and financially it just doesn't work out for someone to be home with the kids. In an ideal world if planning always worked, then it would be great to have one individual remain at home. The other thought that came to mind in relation to this topic is that of extended family involvement. Where if one parent can't be home then instead of day care maybe a better idea if feasible is to have an extended family member providing care and mentorship.

  3. brave post... i stayed at home on one income untill my children were at high school and then went back to work, and never regreted for one minute the years at home they were the best years of my life. i am grateful for the wonderful long time husband who realised the importance of my role and supported the family both emotionally and financially..there is so much pressure on young families to work work work and spend spend spend.. it is good to sit back and ask ourselves what is important in this life..or how do i want to spend these few short years on this earth... have a great day love your blog margie

  4. I'm lucky I stay home,but I've made lifestyle changes to be able to do this.

    My mum went back to fulltime out of the home work when i was in grade 3. I hated that she wasn't home when I got home, that she couldn't come to any school things and that she also worked sat mornings so couldn't take me to sport or stay and watch. She would buy me things all the time, if I happened to say that I liked something then quite often she would get it for me, I soon learned not say I liked something, I didn't want all those things I wanted her to be available to me. When I was in highschool I cooked the evening meal, got the washing in and on Saturdays dusted, vacuumed and cleaned the bathroom. I hated that at the time, however I was so glad when I moved out because I knew how to take care of my home and feed myself. I don't blame my mum or anything but she worked so hard, for so little money and always put off doing things like home renovations so they could pay off the mortgage quicker, then just when dad had retired and they could finally do something for themselves, she got cancer and died. When she was dying she said that she regretted doing it the way they had done and if she had her time again she would have made the most of each day and not worried so much about paying off the house.

    It was a great lesson to me, I decided that I would follow my dreams and not follow the masses if it didn't suit.


  5. We have lived on one income for close on twenty years now. For about two thirds of that time it was a very low income. We have 5 kids, all born during this time and all still at home. I won't claim it was one long picnic, hell no, but I've certainly learned skills and resourcefulness I may not have otherwise. It's certainly a shift in mindset, a close examination of wants and needs and doing away with the desire to have everything brand new. Mortgages are a killer these days though, but it can be done.

  6. No children, just an elderly mother, old house, garden, cat and chickens (not to mention hubby) to tend to... but decided to do this after a couple decades of professional work (I married late). Still "coping" after a number of years, especially after a move, but like I've told others recently, the coping is not about the missing $ -- more about self esteem/social issues and what other people think (they do wonder why...) and guilt about no children. If I had children, I definitely would have done this to be there for them full-time -- but probably would be worried that they were missing out on on certain things, luxuries, that having my income could provide, like trying to keep up with those dratted "Jones" and this technological age... As farmers, my parents never could, so they didn't even try. Good on them. Now I say that. I grew up in an extended family, everyone nearby. Lots of uncles, aunts, grandparents, and cousins (and then their relatives too)... And we all lived this way, so for us it wasn't strange -- though outsiders thought we were more than a bit old-fashioned.

    And really, despite the fact I could go out and make good $ each month (or not), think in the end we are saving so much and live a higher quality of life this way... and no questioning, it is better for the planet. Those type of enviromental costs are fewer.

    Not to say I won't change my mind about all that careerism if the perfect thing happened along! Fickle? It's the curse of itchy feet.


  7. For now, my working fits our lives. I do two days a week but financially we're not much better off. I enjoy the work I do and we have a fabulous childcare centre that provides excellent care and lots of stimulation for my little one. But your childcare estimate was very conservative! We pay $76 a day, I make very little more than that. I'm lucky that the care centre and work are all walking distance from home. I can pop home to to eat lunch and save $$ that way. I know that with a second child it won't work. I'd be paying for the privledge to work. It's a tricky one. I'd hate to HAVE to work and rely heavily on the little extra I bring in. I agree with Lisa, it's all about balance. You need to do what works for your family and your circumstances.

  8. Being able to afford to live on one income and raise a family was something we put a lot of thought into after we were married. Probably, the one thing that made this possible more than any other was our decision to move away from the city, and buy a house for less than half what we would have paid where we were renting.

    It has meant a bit of a commute for my husband (1/2 hour to an hour depending on traffic) but overall it has been a wonderful experience.

    Also, I know it's obvious but sit down and work out a budget and make sure you stick to it.

    I've been a stay at home mother now for coming up to 8 years and had 3 children in that time and have enjoyed the experience immensely.

  9. I'm fortunate that I am able to stay home to take care of my little Itty Bitty. This is a great topic and comments. My husband and I started late and we are learning so much about budgeting and being resourceful. We are so grateful to have this opportunity to bring up our little girl in a loving environment. We know now that it isn't about buying things to fill that empty feeling.

    Thanks Rhonda for a great blog. I am learning so much from reading your blog. My mother is no longer alive and your ideas remind me so much of her. I learned to make a lot of things because of her.

  10. Good common sense Rhonda, however the choice of which partner goes to work involves more than sheer economics. Each ones giftings and desires are a better way to choose I think. My DH is definitely "challenged" when it comes to homemaking skills and childcare. Being a stay at home dad would be a nightmare for him and all of us.

    We chose the lower initial income and spells of unemployment so as we could best fill our skills and desires and work towards the best longterm outcome for everyone.

  11. We made the decision before we got married that we wanted me to stay home with the kids. So many people have trouble transitioning from 2 incomes to 1 so we made the decision to only ever live off the 1 income from the beginning. My income (which wasn't huge anyway) went into savings or for buying 1 off type purchases. We lived on DH's income only. It was really hard as he was earning about half the average wage at the time. But since we had no guarantee of his income increasing we stuck to living on his income.

    Now that his income is higher - we're finding things much easier than they were when we were first married, despite having 3 children and a mortgage on a single income.

    Mind you, if I knew then, what I know now about ways to cut costs and so on, it would have made the $$ we did have stretch quite a lot further. For instance, over a decade has past and we've added 3 children and yet our grocery bill is only $20 a week higher than it was back then.

  12. CK and I decided right away that when children came I would stay home. It was the best decision we ever made. It hasn't always been easy, but we have made it work.

  13. We, like many other who have commented made the decision before we ever had kids that I would stay home with them. I actually may have become the higher wage earner, but I am more interestee in domestic issues than my husband and it works for our family. No matter what challenges come our way we have yet to regret the decision.

  14. Hi Rhonda Jean,
    We live very good on one income when i worked we had less money. I love being at home. I wish I had learn this when my children were at home. A child need their mom and now my dh needs me.:)

  15. After six months of daycare, the emotional and financial costs were just too high. My husband stays home with our 2.5 year old and says that it is the most rewarding job he has ever had, if not very challenging. I feel relieved and able to focus on my work. While he is not much of a housecleaner and I need to do that when I come home, the loss in income, while not a lot is sure worth it in reduced stress and watching the relationship grow between my daughter and her dad.

  16. I read this post late last night after I got home from work and have been thinking about it ever since.
    This is such a difficult issue for young people today with the average mortgage being about $350K, how does one live on a single income?
    I have 2 DD's(26&28), my younger one has a 5 month old son and stays at home with him. They have planned this for quite awhile as it took them 3 years and countless doctors visits to get pregnant. My DD is onto her third house and has downsized considerably from the last one and they have a very small mortgage. They were able to do this for 2 reasons, 1; they got into the property market before the boom and made a profit on the sale of each house and 2; my SIL works in the mines and makes a 6 figure income.
    The price they pay is that he often works away and has just been made redundant from the mine he was at and is currently looking for more work.
    How on earth do people starting out now get a foot in the door??
    The weekend paper stated that unless you are making 6 figures it is not possible to support the average mortgage no matter how much you budget.
    This is a very scary thought as I don't know of many jobs that offer that sort of money.
    I am a firm believer that one parent needs to stay home with their family otherwise what is the point of having kids if you're paying someone else to bring them up?
    I fell pregnant at 17, bought my first house and got married before my 18th birthday so as you can see there was not a lot of planning involved.LOL There was never any question that I would stay home and care for our family but financial pressure meant that I worked part time for most of their lives. I usually worked nights so my DH looked after the kids but those few extra hours I worked often made the difference between eating or not.
    I worked some pretty awful jobs but I did what I had to so I could be there for my kids. And please don't think that once they reach high school they don't need you anymore, I found from experience that is when they need a stable influence more than ever.
    I think many young people these days have very high expectations and want the dream house with media room, new cars, etc, etc and unfortunatelt it is at a very high cost to their family life.
    But having said that it is very difficult to find a decent house for a decent price. I do fear that my DS(20 today!) will never be able to afford a house and a family, it will be either/or.

  17. I've been home full-time for - gulp - almost 7 years with my 2 children. During that time my husband went from a $150k+ job, working long hours with lots of demands, to working for himself, where his hours are flexible, but there is no steady income. Some weeks there is no money to spend, and other times there is a bit. When we got the first tax statement a couple of years ago I couldn't believe how we'd lived that year on so little (less than 3/4 of what we'd had before). I adore op shopping for my and the kids' clothes, get takeaway once a month, go out to dinner as a couple rarely, and mainly cook from scratch (we eat meat), and go on a cheap family holiday once every 2 years. We still have 2 cars, have Foxtel (he can't live without it), a golf membership and I go out with my girlfriends once a fortnight at least. We have a certain amount of spending money each week, so I can choose to go to the hairdressers (or get my sister to do my roots) or buy frivolous stuff.
    One thing I've found is that I've never spent a lot of money on furnishings and accessories for the house. A lot of my friends spend a small fortune on new rugs, lamps, cushions, bed linen etc, and they are always changing them, and renovations to make their large houses even larger.
    This is such an interesting topic, thanks for bringing it up.

  18. Thank you all for contributing to this important topic. I appreciate you sharing your thoughts here as I know it helps not only me, but also many others to understand how to live with less money.

  19. Arghh, I meant to say 1/4, not 3/4 :-)

  20. Hiya,

    We are so lucky that I can afford to stay home with our tribe. One of the reasons is that we have always been a couple who have lived simply.

    The Husband because he grew up in China in the Cultural Revolution, so it is ingrained into him to be frugal.

    Myself because I saw my parents lose everything in the 80's due to an excessive consumption lifestyle and I remembered my Grandfather telling them

    "You cut your pattern according to your cloth".

    Those words just made so much sense to me; adjust your wants, live simply, grow your own food as much as you can, reuse, store your produce. Simple Depression/WW2 ideals which have gone by the wayside in this easy purchase - pay later lifestyle we are encouraged to have.

  21. My hubby and I would like to be more even. If we have children we both want to work part time (if we can get suitable work) so that we can both enjoy being with our children and both enjoy some time being stimulated in an environment with other adults. I would ideally like to work 4 days a week pre children and then post maternity leave I would like to work maybe three. Between us we would work 6-7 days. If one worked monday to wednesday and the other Thursday to Saturday you would still have one day for the whole family together and there would always be someone to be at home with the children.

    I wonder if there are other people out there doing this. Maybe it's hard to find decent part time work and one partner may earn less so that in the end it might be a lesser amount at the end of the week. I have not come across many people doing it that way.



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