In Jim’s original post he posed a seemingly simple question: Stay at Home or Pay for Daycare? Since Jim isn’t a parent yet, there are many intricacies and options that the post didn’t discuss. I’m here to fill that gap.

Income Affects Outcome

Single parents can not even fathom the question of staying at home vs. daycare. They MUST work because they are the only breadwinner in the home. Unfortunately the vast majority of women who are single parents live at or below the poverty line making work equivalent to survival and the only relevant question being how they can provide the best care possible for their children. Not an easy proposition.

Many mothers stay at home with their children because the can not afford childcare. Kathy Lopez, is a mom of 4, who said “last year I had hoped to work or return to school but the cost for care for three children was way more than I could make. I have done an analysis on the costs of care numerous times over the past seven years – the first time I hoped to return to work, paying for FT childcare for my son would have left me with $60/weekly to bring home.”

The Cost of Quality

Babies need attention, love and a stimulating environment to thrive. Caregiving, and parenting is an intuitive process. While it is possible for daycare, nannies, and other caregivers to provide attention, affection and love, not all daycare centers provide this kind of attention. Finding a quality environment for your child is difficult. Christine DeLaurentis, a mother of 2 children who attended daycare from 3 and 5 months respectively, said that she and her husband “found all day care centers in our area, called ALL of them for information, then visited five of them before settling on which one to use.”

Every parent I spoke with had completed a cost analysis for working versus staying at home, and most parents have a clear winner in terms of the numbers.

A Case for Daycare

The parents that were the happiest with daycare were those who were happiest in their careers, or who had found a positive work/life balance. Stacy Hinton, a mom of one son with another on the way, says her career as a teacher allows her to spend a lot of time with her son. She also shares that “in my professional opinion, daycare kids are way more prepared for kindergarten, academically and socially,” making her decision straightforward.

Many families choose daycare and dual incomes to maintain their lifestyle. Liz Murihead, a mom of 2, says that her spouse “… wants to stay home, but isn’t willing to change his standard of living to do it.”

Liz feels that her personality is not suited towards being at home. “I am a better mom because I work. I try to be there and spend lots of my non-work time with my kids. I don’t have the patience to be the kind of SAHM I would want for my kids.” She also says her children are thriving in daycare.

Rob ODaniel feels similarly about his adopted son’s personality. “He just fell right in with daycare, I suspect because it’s so similar to the orphanage environment that he’d been in since he was about 8 months old. He responds very well to structure & routine. Liam is a very sociable boy and has thrived in the group dynamic of daycare.”

The main drawback for most working parents is trying to squeeze activities, homework, cooking and cleaning into the few hours they have at home each evening.

When Does Daycare Work?

For those families that can choose, daycare seems to work best when parents are happy in their careers and earning more than they pay for childcare and work related expenses. It also seems to work best when the child or parent’s temperaments aren’t suited to staying at home. I would also argue that quality, affordable childcare is vastly different in various areas of the country. For tips on how to find a quality daycare in your area check out Smart Momma’s guide.

A Case for Staying At Home

An estimated 6 million parents choose to stay at home with their children. These families make sacrifices, and cut corners to have a parent stay at home. They feel it is important to have a parent provide the care for their children, and are willing to sacrifice career growth, money, and luxuries to do so.

Staying at home also has other benefits. The at home parent can use their time for other opportunities. You only need to look around the blogosphere to see a number of stay at home parents who blog, or run small businesses while their children nap.

Another benefit, the expense of working outside the home (fast food, convenience foods, dry cleaning, work clothes, etc.) disappear, because the at-home parent can choose to focus on ways to save the family money.

It is also possible to choose to stay at home even with a low income. My husband was earning only $18,000 a year when we had our first child. We were very frugal, buying used furniture, having date night at home, and sharing one car.

The main attraction for stay at home parents though is one that has nothing to do with finances. Watching your children grow and explore the world can be an amazing way to spend your time. Kristin Crawford, a mom of 2, has no shortage of activities she provides for her children. “My son loves going places in the car. We go out of the house pretty much everyday. We have playgroups, the zoo, the Y, and other kids play places outside the home.”

The main drawback to staying at home is making sure the at home parent gets plenty of adult interaction. Many moms use the internet for this purpose, and connect with other moms all over the country and world that are facing the same issues. “I couldn’t work because I couldn’t make enough to cover childcare costs, but I needed something for ‘me.’ Hobbies didn’t seem to work out, but I have been able to include volunteer work that has helped keep me in contact with the outside world,” shares Kathy Lopez.

When Does Staying At Home Make Sense?

Staying at home makes sense when childcare expenses are more than or equal to the parents take home pay. It also makes sense for those families who believe that having a parent at home is beneficial to their child(ren). Parents with larger families, the desire, or the personality suited towards taking care of children are the ones who make it work best.

Alternatives

Many families choose neither of the above. They may choose, as one commenter posted “babysharing”, nannies, au pairs, family members who watch their children for free, or a combination of daycare and staying at home. Still other parents choose to work opposite shifts, like Kathy Lopez’s cousin who, “decided to have someone at home with their kid/s because it was important to them. My cousin switches off with her husband. She works daytime hours at an investment firm and he works an overnight shift as a cop in the city.”

Freelancing, consulting and owning a small business all require endless hours of work, but because you are your own boss, you can often make time to start a business or blog when the children are napping.

Kim McGrigg has found balance though by working part-time and using day care part time. “When I was working full time, I often felt like I was not doing either thing (being a parent, being an employee) to the best of my ability. My solution was to go part-time. I learned to better manage my time at work and be there for the kids”.

No ‘Right’ Answer

As Kim points out, “the decision is never as simple as putting down some numbers.”

In the end there is no right answer. Most families struggle with this decision. When a family chooses to have more than one child, the decision making process starts again. For most families there is a combination of a part-time gig with one parent (school, their own business, volunteering, etc.), and the other works full-time. The parents I know that do stay at home full time, are mostly happy with their decision, and highly engaged in being with their kids, and watching them learn and grow. After all, it is only a short time before they are off at school, or out on their own.

Most importantly, it is key to remember (as with everything with children), what works today may not work tomorrow, so to have this discussion is vital, but remember that nothing is set in stone.

The experience of having a child changes many things in your life, if you are open to it, and just when you thought you had your answer you just might surprise yourself.

Who am I?
I’m a parent to 4 children. Aged 11, 7, 5, and 3.

I’ve never had a full-time job outside of the home, but I have taken part-time work, and (as I do now) held several jobs at once. I did for a time fully dedicate myself to my kids, and loved and hated it depending on the day.

I did not have a career before my first son was born at age 21, and therefore my earning power was significantly lower than many first-time mothers. I had hoped to go back to school and start a career once the kids were all old enough, but my oldest was diagnosed with Asperger’s Syndrome, and is now homeschooled, making a full-time job out of the question for now.

My husband works really hard, and has a great career that allows him to be home at a reasonable hour, without much travel.

Kelly can be found on my blog, The Centsible Life and on twitter @centsiblelife.

(Photo: eugeniajulian)

Daycare vs. Stay At Home: A Mom’s Perspective from personal finance blog Bargaineering.com.

So in our modern age where you have two working parents, many couples have to decide whether they want to keep two incomes or drop down to one. If we were to make that decision, here is what I think we’d do in preparation.

Daycare vs. Stay At Home

While the start of the decision making process may seem quite analytical, the decision itself is almost entirely emotional. The numbers may force your decision but more often than not, they won’t and you’ll be stuck deciding between the non-financial aspects.

So here’s the million dollar question – Should Mom or Dad continue to work and pay for daycare, or be a stay at home Mom or Dad? The answer lies first in the numbers.

Cost of Daycare

For our analysis, I used the average weekly rate of the first three daycare facilities in our region on Google Maps that listed their rates online. The average rate, for five full days, was:

• Infant/Toddler: $1,500
• Two Year Olds: $1,200
• Three & Four Year Olds: $1,100

Breakeven Point between Daycare vs. Stay At Home

If you have one infant and are paying $1,500 a month for daycare, that’s equal to a $2,000 a month salary in the 25% tax bracket. If you earn less, you should become a stay at home parent because you are spending more on daycare than you are earning at your job. If you earn more, then you have to decide whether the difference is worth the time away from your child.

This analysis simplifies the math tremendously. First, it assumes a marginal tax rate of 25% which isn’t accurate if you’re a single parent earning $24,000 a year (15% marginal tax bracket for the 2009 IRS tax brackets). Secondly, it ignores all deductions from income.

If you have two children, say an infant and a two year old, then the total cost is $2,700 a month or $3,600 salary if you’re in the 25% tax bracket. Again, the decision is still the same. Do you stay at home and save the $3,600 or do you work and pocket the difference?

Non-Financial Factors

Arguably the biggest considerations you have for this decision are the non-financial ones. To simplify it, in daycare, your child gets socialization with other children. At home, your child gets more attention from the parent who is staying at home. There are obviously other considerations but those are probably the biggest arguments for either choice and they’re clearly non-financial.

The problem is you can’t assign a dollar value to those factors. How important is it for your toddler to interact with other children his or her age? Is it more important for a toddler to spend time with a parent at home?

The Decision

In the extreme cases, where you are earning less than the cost of daycare or where you are earning far in excess the cost of daycare, the financial aspects force a particular choice. It’s in those borderline areas, where the numbers don’t point to a clear answer, where the non-financial aspects used to decide. Like anything else in life, it’s not always about the money.

To the parents out there, if you went through this decision making process I would love to hear your thoughts about it. To the non-parents, is this something you’ve discussed? If so, what considerations have you talked about? I think a lot of people struggle with this decision and your insight would be invaluable.

(Photo: eugeniajulian)

Stay At Home or Pay for Daycare? from personal finance blog Bargaineering.com.

(that photo is of the actual homemade apple pie I made, you can tell it’s homemade because of the smile! )

Pie Crust

I wanted to make a homemade crust but I was short on time. She told me she would be home at around 1PM and, at around eleven, she told me she was an hour ahead of schedule and would be back at noon! Since I was running short on time, I chose to buy pre-made pie crust from the store. Crust, in general, is not very difficult to make but is probably difficult to make well.

There’s something about the really flaky, crunch stuff that you simply can’t get from a crust you unroll out of a plastic bag. I recognize that store-bought crust is vastly inferior but I didn’t want to try to make a good crust in a hurry (for the first time no less!). If I were to make a crust, I would’ve used this recipe from SimplyRecipes. With two sticks of butter, I can’t see how it could be a bad crust.

Filling

The recipe for the filling is simple:

• 5 Granny Smith (tart) apples
• 1 cup sugar
• 2 T flour
• 1/2 t cinnamon
• 1/4 t salt
• 1 T Apple Cider vinegar

The most time consuming part of the process is peeling and slicing the apples. First, peel and slice the apples, putting the pieces in a water bath mixed with a tablespoon of lemon juice to prevent browning. When you’re done, take all the other ingredients and mix them together in a bowl.

Use a fork to mix because it’ll help break up clumps as the dry ingredients mix with the cider vinegar. Drain the bowl of apples and mix in the filling mixture. When you’re done, it won’t look like much but you have yourself some apples slices covered in cinnamon and sugar.

Baking

Put down the pie crust and add the filling. I cooked mine at around 400 degrees F for 60 minutes with the edges covered in tin foil. Then, finish off with another ten minutes with the foil removed so it can turn a little brown. Just keep an eye on it so you don’t burn it and add time if the browning isn’t to your liking.

For easy cleanup, slip a pan underneath the pie. As the filling boils and cooks the apple, liquid will leak out and drip.

Enjoying!

Now for the best part, serve it up with some vanilla ice cream!

Homemade Apple Pie Recipe from personal finance blog Bargaineering.com.

I try to convince him that in most cases, generics are basically the same exact thing without marketing, which equals a lower price for the consumer, but he won’t believe me. And, I think he still doesn’t, but he does grumble a little less most of the time.

The fact that my husband is less than adventurous in his brand selection and likes to stick to the trusted old favorites he “knows” doesn’t mean I have to spend top dollar on everything I buy. There are some simple strategies I’ve employed to keep our budget under control but also keep my spouse happy.

Identify Needs vs. Wants

First – determine what is just a preference, and what is actually a specific need. There are things my spouse just thinks he likes better, and then there are things that he actually prefers, and my challenge was to determine which was which. To figure that out, I did a number of blind taste tests – not like you see on TV (although that could work too) but in my case, I did them unbeknownst to my spouse. Please don’t get all up in arms that I was tricking him – I told him all about my plans and the tests, I just didn’t tell him specifically when and where they would happen.

From cereal to soda to deli meat to peanut butter to pasta (and many things in between), I bought the generic version of the item and tried it out on my spouse without notifying him of the timing of the change. If he accepted the item as normal, I’d show him how it was the generic version and that would become my go-to item. If he had some sort of “what is this?” reaction, I knew he could tell the difference.

Embrace Your Preferences

Once you know what of the many preferences the person has is actually impacting their quality of life, embrace that preference (no matter how wacky you might think it is). Many of the things my spouse thought he really *needed* he realized that he was just accustomed to using a certain brand, either because of the marketing or it was what he had used as a kid. But there were a few items where he could noticeably tell the difference, or he simply drew the line at experimentation. Such as deodorant, and it wasn’t worth my time to argue with him. (He also has a specific bagel preference as well as a preference in some types of cereal among a few other things.)

My purpose in this was not to make my spouse crazy, but to trim down unnecessary “brand-name” spending as much as I could. For these items, I had to come up with ways to incorporate them into our budget but make it cost effective as well. Here are some of the tips I use to incorporate “high end” items in our house without breaking the budget:

Become a sale-watcher. We get the Sunday paper at our house, and I go through all of the circulars to look for my specific brand name list and see if any of them are on sale for a good price. I have the luxury of living in a fairly urban area where many of the stores are grouped in close proximity, so I can go to a number of different stores (if needed) in a single trip.

Use coupons to your advantage. Coupons are great, but they work even better if you wait to combine them with a sale price. You can clip coupons yourself or use a coupon service to order many multiples of the same coupon to be able to use them for stocking up. But therein lies the question – how do I know when to stock up?

Keep a price book. For me, this is the key to all my shopping effectiveness, not just knowing when to stock up. If I keep track of the price of items over a period of time, I can start to see trends in the pricing and almost anticipate when there will be a sale at a particular store.

Having someone in your family who is tied to name brands doesn’t have to be a complete budget buster. With a little detective work and planning, you can sort out what the real preferences are and come to a compromise that makes you and your family happy. And compromise is the key to successful relationships, after all. Well, compromise and understanding that I am always right, but that’s a topic for another post….

(Photo: lyza)

Managing Brand Creep in Grocery Shopping from personal finance blog Bargaineering.com.

We spent a lot of time this year looking for that middle ground. My oldest child will be starting kindergarten this fall, and although I find a lot of positives in our school district as a whole, my particular local option falls short in our eyes. While our particular neighborhood local public option leaves a lot to be desired, yet we couldn’t fathom how we would be able to afford the private options in our area. We felt there had to be some compromise we could find, and we were right, we just had to know where to look.

Resources and Questions to Ask

I used a variety of resources to research our options for my son this fall. He is currently enrolled in a special education public school program, so I asked his teachers for recommendations. I used some online resources such as greatschools.net to look at ratings from parents and teachers as well as standardized type scores. Finally, I called and visited prospective schools and asked a lot of questions.

What questions did I ask? Every situation is unique. For us, my son has a delay in verbal intelligence relative to his non-verbal intelligence. We looked for a school where he would be well-integrated and receive adequate resources to help him excel. Since you know your child, you’ll what questions to ask. Here are some things you should ask about:

• Ratings (standardized tests)
• Attendance levels
• Special education programs
• After school and extracurriculars
• Fine arts programs
• Physical education programs

Primary School Options

• Local public school: The first and simplest option is your local public school. Don’t assume that this option is settling for substandard. There are many public schools that are excellent, and yours may be one of them. Do the research, look at the ratings, and visit the local option.
• District offers school choice: Our district offers school choice, in that we can apply to have our child attend any of the schools in our city. The process is one of lottery, so there is no guarantee on getting into a different school, but the option is there to attempt.
• Charter schools: There is in our city several charter schools, some free of charge to residents. One of these programs may be a better fit for your child than your local option.
• Religious schools: If you are of a particular religious faith (or even if you are not) a religion-based program may have better tuition rates than another private school.
• Private school: There is as well this option – usually the most expensive but many have assistance programs you may qualify for.

Don’t assume expensive is best! We’ve all been conditioned, by advertising or nurture or some combination, to assume that the most expensive option is the best option. You get what you pay for after all, right? However, as in every saying there is some truth and some fallacy. You do get what you pay for, to some degree, but there is a wide range of good and better hidden amongst any options.

Consider your options and get the best bang for the buck for your child. Don’t bankrupt yourself sending your child to private school but don’t compromise on their education. There are always options and a middle ground may be reached.

In our case, my son was accepted into another local public school through the lottery system that I felt was a better choice for his needs. And the best part is that it’s no farther from our house than his original elementary school and it is still free!

(Photo: mrhayata)

How to Save on Primary Education from personal finance blog Bargaineering.com.

The short answer to this question is that there is no right time. But, there are a lot of things to consider when deciding whether to have children, and many of them are financial. Here are some things to think about when you’re making that big decision:

Are you in a relatively stable place in your life? This is a basic question, but it’s the big one. While nothing can be perfect, bringing home a baby can create unimaginable upheaval, and ideally, there will be as little to stress you out as possible. That means you’ll have a stable job situation, a roof over your heads that’s not going anywhere, and the ability to provide for the necessities (food, water and shelter) for your family.

Can you afford the “unnecessary necessities”? Technically, the only necessities in life are food, water and shelter. But in our society, things like life insurance, disability insurance, and health insurance are also necessities. Once you have another, helpless person depending on you to provide them with everything they need, you realize that you need to have various forms of insurance in case you can no longer provide for them.

What stage is your career at? Assuming you’ve got the basics covered, you can go on to consider other less fundamental but yet important things like your career goals and whether they are compatible with having children. If, for instance, you want to be a super litigator, you’re probably not going to be available much. Is that okay with you and your spouse? I know many attorneys who see their children for an hour or less per day during the week, and not much more on weekends. Keep in mind that your goals will quite possibly change before or after your child arrives. Personally, I discovered that I cared less about being a great attorney and much more about being a great mom.

How old are you? A woman’s fertility is greatly affected by age, and at 35, her chances of getting pregnant and having a healthy baby start to decrease substantially. Men aren’t immune either – studies have shown that children of older men are more likely to be autistic. And, a lot of fertility problems aren’t discovered until you start trying to have a baby. I had two miscarriages before my oldest was born, so we became parents a whole year later than we expected, and now that I know what some of my friends have been through, I consider myself lucky. Also, fertility treatments are expensive and often not covered by insurance.

How much time will you be able to take off from work? If you intend to keep working after your baby is born, then you’ll want to consider the leave your employer will allow you to take. Your employer’s legal obligations are governed by state and federal law, and some laws don’t apply unless you’ve been working for a minimum amount of time.

Of course, the most important thing to consider when deciding whether to have a child is simply, do you want a child, and do you want a child now? If the answer is yes, then you’re in for a wild, fun ride!

(Photo: tedsblog)

When Is The Right Time To Have Children? from personal finance blog Bargaineering.com.

The idea of an allowance is one that most of us have been familiar with since childhood, but not in a necessarily positive way. An allowance is the way that someone else in authority exercised control over us and our spending, by allowing us (hence, allowance) a sum of money per week or month from their coffers that we could use as we wished.

Freedom vs. Control

But as an adult, giving yourself an allowance doesn’t have to be controlling. In fact, it can be very freeing. The concept of giving yourself an allowance is a simple one – when you set up your monthly (or weekly) budget, allocate some to yourself to do with as you wish. This is your allowance. It can be a small amount, or a not-so-small amount, depending on your situation. Budgeting yourself an allowance can be a way of being able to budget effectively and yet feel freedom to make fun and/or impulsive choices with our money as well.

Now vs. Later

We hear pay yourself first but that refers to saving for the future. There has to be a balance in our lives that involves spending for today as well. Not every minute of every day, can we consider just what will happen later. The allowance is the paying yourself first that gives us day to day flexibility instead of future flexibility. The combination of the two (paying yourself first for now and for later) gives you an added level of both security and freedom.

Ease or Eliminate Deprivation

For those who already work within a budget but are feeling a bit controlled by it, placing limits on spending lets you spend without guilt, but also keeps that spending to a reasonable and appropriate level. A common complaint about the concept of budgeting is the feeling of deprivation it gives. The allowance combats that by giving money in hand to spend on whatever you want without guilt – and that flexibility helps to ease or eliminate those feelings of deprivation.

You need to have some level of freedom to do what you want as well as need, or you’ll explode. And an allowance allows you to have that flexibility within the framework of a overall budget. You can make your money work for you by assigning it roles and keeping track of where it goes, yet build in a level of unexpected fun and flexibility for day to day or week to week expenses.

An Allowance Can Work Long Term, Too

But on the flip side, you don’t have to run out and spend just because you can. My husband, for a long time, desired a purchase that just wasn’t in our budget but also was not reasonable to spend a week’s or month’s allowance on – a Playstation 3. So he set up an ING savings account and saved most or all of his allocation every week, and eventually was able to make a big purchase without guilt, that has brought him a lot of enjoyment. Your allowance can work for your own personal long term goals as well as short term wants – it all depends on how you choose to use it.

Choice

An allowance gives you the ability to make choices. It is not a license to indulge in anything and everything, and inherent in that is the beauty of the allowance. If the idea of budgeting makes your skin crawl – give the adult allowance a try. Spend unexpectedly only within a preconceived limit, and add a little bit of budgeting within a network of flexibility. You might be surprised at the outcome.

Have you tried an allowance?

(Photo: photophonic)

Do You Need An Adult Allowance? from personal finance blog Bargaineering.com.

Sometimes it seems like our children are programmed to turn a deaf ear when we begin to talk about doing chores, saving money or preparing college applications. Many parents struggle with how to broach these topics without nagging, boring or confusing kids, and as a result, the conversation may never happen. Here are a few conversation starters to get your kids talking about money:

• I Want: There’s no better time to strike up a conversation about smart money management than when your children want something. Whether it’s the latest toy, designer jeans or a candy bar at the register, kids are often looking for instant gratification. Discuss the price of the item and how long it would take your kids to pay for it with their part-time job, allowance or gift money. If it’s a higher-priced item, are they willing to wait and save for it. If they’re not, why not? By drawing them away from instant gratification, you can help them evaluate what they really want and how spending habits now can shape their financial situation later in life.
• Don’t Hide It: Next time you sit down to pay the bills, do it in the kitchen when your kids get home from school. Have a snack prepared for them and explain what items you have to pay for. They may not understand that water and electricity aren’t free, or that you DO have to pay for the items you buy with a credit card. Even a short conversation to begin with could lead to longer conversations down the road.
• Share: Be open in your family communications about money. If you make personal finances a taboo topic, your children will too. By engaging in open and honest communication with your kids, talking about money will be less threatening. Don’t wait until you get upset to blow up over them spending too much at the mall or not putting birthday money into savings. Keep the dialogue open so there are never any questions about what you expect.

There are so many ways to talk to your kids about money; the important thing is to just do it. By making them comfortable discussing money now, you can save them a lot of heartache in the future.

Editor’s Note: A few years ago I volunteered at a Junior Achievement event. I can’t remember the name of the “game” we played but it involved a mock city with stores and banks and jobs, simulating real life. As volunteers, we were essentially chaperons for whatever “building” we were in and the students (all grade school level) were the employees.

We were there just to give guidance and make sure they didn’t get too crazy. I remember sitting in the little “radio station” that played music throughout the room and our little enterprising employees sold “shout-outs” to their friends. It was a great time and I thought it was incredible that there was an organization dedicated to teaching young people financial skills they could use in the real world.

About Junior Achievement® (JA)
Junior Achievement is the world’s largest organization dedicated to inspiring and preparing young people to succeed in a global economy. Through a dedicated volunteer network, Junior Achievement provides in-school and after-school programs for students which focus on three key content areas: work readiness, entrepreneurship, and financial literacy. Today, 137 individual area operations reach more than four million students in the United States, with an additional five million students served by operations in 123 other countries worldwide. For more information, visit www.ja.org.

If you’re on Facebook, Junior Achievement Worldwide has a JA Worldwide Facebook page. Become a fan and you can get access to all the latest news and learn ways to volunteer (it’s very rewarding), they are also on Twitter as @JAworldwide.

(Photo: pingu1963)

Easy Conversation Starters About Money with Your Kids from personal finance blog Bargaineering.com.

In short, the “I Wants” have hit our house hard over the past year, and will most likely continue until we boot him out of our house after high school (and maybe even longer than that…). So I’ve had to think creatively about how to counter the constant “I Want…” reasonably and without resorting to “Because I Said So” every time!. Out of necessity and the preservation of my sanity, I’ve developed a few techniques I use when explaining that we can’t always get what we want, in four year old terms.

Teach in Terms Your Child Understands

Translate the value of money in terms your child understands. For a long time after my first was born, I would say things to him that he found meaningless because I wasn’t used to thinking in “child” terms. Telling a two year old that we were leaving a playdate in five minutes wasn’t giving him any information that he could understand. Why I was befuddled when a tantrum ensued when I brought him his coat every time is beyond me. But luckily I’ve learned a few things in the ensuing two years, and one of them is that it’s important to break down abstract concepts into concrete terms that are applicable to my kids’ lives.

When he wants something, I use items he already has to explain what it costs. We still talk about money, but I put it into terms of “That robot your friend has and you want would be like giving up five of your matchbox cars and your favorite dump truck, is it still something that is important to you?”

Teach About Choices

If your child is old enough, you can give your child some of the responsibility for making choices. Giving your child an allowance can help with this. If your child wants something, show them what it costs in terms of weeks of allowance or what they may have saved already. This ties directly into putting money into terms that they understand. We are working on a sticker system to illustrate the passage of weeks for my son and give him an idea of how long he would need to “work” to afford something he wants. Oftentimes, the passage of time cures the urge of instant gratification and he decides he didn’t want that item as much as he thought he did!

Another big concept we are working hard on is instituting a toy, game, or other appropriate limit; and enforce a one in, one out rule. If your child wants to bring a new “something” into the house, they have to give up something else. This cuts down on clutter and teaches your child to make choices and trade-offs. Are they willing to trade the new for the old?

Teach Them How To Give

Finally, introduce the value of giving. Instead of agreeing to your child’s whims wholeheartedly, help them make choices to give to others. Taking advantage of a program such as Toys For Tots, and explaining to your child that there are others who don’t have toys and you are fortunate enough to be able to give toys to them. This may help your child understand that not everyone has the advantages they have. Instead of taking your child shopping for themself, take them shopping for something to give to a child less fortunate than they are. Understanding the power of sharing and giving to others is a lesson you can learn at any age.

Battling the constant “I Wants” can be tough. It is hard to find the line between not indulging your child’s every whim and teaching them to understand how to make thoughtful choices. With time and effort, your child may learn to save their wants for what is truly meaningful to them, and your ears may get a little break.

(Photo: luschei)

How to Battle the “I Want” Syndrome from personal finance blog Bargaineering.com.

Just as some people have specific preferences for food, others have preferences for specific brands of clothing. In your family, this person may or may not be the same person. In ours, my husband is the guilty party on both charges – he’s just not that adventurous of a person. He has specific stores he will shop at for clothing, and specific brands clothing he will buy for himself if left to his own devices. He’s worn the same exact style and brand of jeans for all his adult life – he just buys more of the same exact one when one wears out. All his dress clothes for work are from the same exact store, and they are specific cuts and styles he prefers, all of the same brand.

Is this by definition a bad thing? Not necessarily – if you find what looks good on you, you may want to stick to that style, color, or type. But taken to an extreme, or buying brands simply because they are a specific brand, and you fall prey to spending top dollar on your items when middle or low dollar may work just as well. Slowly but surely, I’ve been expanding his wardrobe specificities, and here’s how.

Broaden their horizons – a little at a time. When trying on the items they like, convince them to throw one (or two) other items into the mix they would never pick out on their own. When I go shopping for clothing with my husband, I usually pick out at least one item he would have never picked up off the rack to try on if he left to his own devices, and have him try it on too. It only takes a minute, and it has actually helped expand his clothing horizons to some degree. He still will only buy one specific brand and style of jeans, but he is more open to dress clothing, sweaters, and other items he would never have considered before. And the more options you have, the more likely you will be to able to find an option on sale.

Think outside the box on stores – try discount stores, outlets, or even used clothing are all good options. While it was difficult to convince my husband, it paid off handsomely in the end. Once he agreed, it cut down his clothing expenses considerably. We don’t have any outlet stores in our area, but if you have outlet versions of your favorite stores available, be sure to give them a look because they offer great deals. Before we moved, I was able to save money on clothing by checking the outlet first. We do, however, have discount overstock stores, like Marshalls and TJ Maxx, that carry name brands. These stores carry overruns of brand name clothing and I have been able to find the same shirts my spouse buys elsewhere for half the price (or less!).

The one that was the hardest for me to get my spouse to agree to was used clothing – I am an avid Goodwill shopper and see clothing for him there all the time. But once I showed him that I can even find “new with tags” clothing there on occasion for him, he (slightly) warmed up to the idea. I have been able to purchase several of his dress shirts there for $4-5 each. He still wouldn’t go there himself, but he doesn’t freak out when I walk in with the Goodwill bag any more.

Use eBay to find hard to fit measurements at less than premium prices. eBay can also be a great source of name brand clothing at discount prices. There is a vast selection of clothing on eBay to choose from, and much of it has competition that drives the price down. It isn’t a fail-proof method, but I have had success finding many almost new items on eBay that I would have paid twice as much (or more) for brand new. Keep an eye out for the NWT acronym, it means “new with tags,” and anyone seeing it would have no idea you bought it off eBay.

When there is someone in your home who always has to have a specific brand, shopping can be a frustrating and expensive experience. Hopefully by incorporating some of these tips, you can slowly open their mind to think beyond the label or specific style and open up a whole world of possibilities to them. Or, at least have fun experimenting with your family member’s comfort zone.

(Photo: fukagawa)

How to Battle A Brand Whore from personal finance blog Bargaineering.com.

The article talks about a 43 year-old woman who lives in a 2 bedroom council flat, which is the equivalent of low-income housing here in the United States, with three children and one grandchild. She doesn’t work and has never worked. The family has had some pretty terrible experiences recently, documented in the article, but my compassion wanes as I hear how they entered the situation.

These lines in the article changed my sentiment completely, which I’m sure you’ll pick out when you read the brief article:

• … But she concedes that she doesn’t really know why she didn’t get a job, and that there was an element of just “not getting round” to it.
• … She doesn’t think school wanted her to stay on because she “wasn’t too bright” and used to bunk off [not attend] a lot.
• … Without any qualifications she assumed she wasn’t able to follow her chosen path and join the Army. She never actually made it to the recruitment office to ask.
• … As no-one in the house is actively seeking work, they don’t count as “unemployed” and none claims Jobseeker’s Allowance [unemployment].
• … “I’m sorry they have to pay tax money to me. If I could get a job… give me a job then and I’ll work, and then they won’t have to pay me.”

The lesson here is that you have to take control of your life. I don’t think she’s lazy but it just sounds like she didn’t try to do anything. She didn’t get a job, didn’t finish school, and all before the whole aspect of family came into play. I can understand not working or going to school to raise a family, but the reality is that none of the children work either! William, her son, was savagely attacked by local gang members, a situation that likely wouldn’t have happened had they not chosen to live in council housing in the first place.

The thing that gets me is that she didn’t even try. None of them did. There are plenty of stories of people who have tried and simply given up out of despair because of the economy. I have compassion for their situation because they’ve tried to change their situation. While this family doesn’t take unemployment (Jobseeker’s Allowance), they also aren’t taking any steps to improve their condition. The daughter sits at home all day.

Am I being too harsh? What do you think?

A Non-Working British Family from personal finance blog Bargaineering.com.

Now, back to the matter at hand, we are looking to get a smaller type dog (around the size of a terrier rather than say a lab) so this brief total cost of ownership analysis will be focused on a small dog. We’ll also be going with a pound puppy rather than a bred dog because we feel that since it will be a pet, and not a working dog (my friend hunts, so for him a pure bred Labrador is a must-have), it’s better to go that route. We understand that there is always the potential for future health issues and unknowns about the puppy but that’s a risk we’re willing to accept.

Acquisition Costs

As mentioned earlier, we’ll be going with a pound puppy so we won’t be paying a breeder any fees and chances are all the initial veterinary and medical costs (for things like spaying and neutering) are mostly covered. However, let’s say that none of them are covered and let’s work from there and let’s call them acquisition costs. In reading various resources online, the estimated cost of the first year’s vet and medical costs can range anywhere from $100 to $700. So, if you know how much you can buy your dog for, add on around $500 (just to be safe) for medical costs and you have your acquisition cost.

Fixed Costs

Fixed costs refer to all the things you probably will buy once and then replace as needed. These are things like a water bowl, beds, toys, a crate, cleaning supplies, etc. This varies greatly but you’re talking a base of around $150-250 depending on where you live. Urban areas are obviously more expensive than suburban or rural areas and the best way to determine this is to just go to your local store and start adding things up.

Another fixed cost you may have is training. You can try to train a puppy yourself through the help of books or websites, which is very low, or you can go with a professional. The benefit of professionals is that they know what they’re doing, but they aren’t cheap. Training could cost you several hundred dollars, but training is essential for your mental health!

Variable Costs

Variable costs really are variable! They include the replacement of some of your fixed costs since they will be used and deteriorate. However, those will out be likely dwarfed by food. The best way to determine this is to ask the place you’re getting your dog from or looking up online. A quick search shows that dog food for a Westie is around $30 a month, or $360 a year. You may also have other variable costs like various medical items to keep your dog healthy, remember to include those as well.

Total

If you estimate the average lifespan of a dog is around twelve years, the cost of the dog could reach into the tens of thousands of dollars. It’s important that you’re aware of this before you get a dog because you don’t want to one of the many owners who are forced to abandon their dog at the pound because you can’t afford them. It’s an unfortunate circumstance but it happens all the time.

One quick note about emergency funds and pets, we will be boosting our emergency fund whenever we get a pet (much like we would with kids) because pets can have accidents and problems just as people can. I’m not exactly sure how much we will adjust it upward but we definitely will.

Time to look for a puppy!

(Photo: cloneofsnake)

Total Cost of Owning A Dog from personal finance blog Bargaineering.com.

Should you quit your job and stay at home with your baby? This is probably the biggest question new parents have to face once they find out their little one is on the way. The truth is, there’s no right or wrong answer to this question. It all depends on what is best for your family. If you quit your job and stay at home you are going to lose income. You have to weigh that against the benefit of having more time with your child.

Before you make that decision, it may help to weigh the pros and cons a bit, and take a logical look at things.

Can you afford to quit your job and stay at home with your baby?

Losing a large chunk of your monthly income isn’t easy for any family. You will have to make a lot of adjustments, not the least of which is trimming your budget. If you are home to take care of your baby, then you can breast feed without interruption (obviously if this is mom staying home and not dad!), you can cook regular meals instead of eating out, and you can spend less on clothing. All of those things save you money each month. You will also spend less on gas, and you will not have to pay for daycare services.

The only way to tell if you can really afford to quit your job and stay at home is to work out a detailed monthly budget. Factor in how much money you will lose, and how much you expect to save. Do not forget that you will have additional expenses once your baby arrives. You will have to pay for clothes every couple of months, formula if you use it, and more diapers than you will ever believe.

If you cannot make things add up, and you don’t see any way that you can quit your job and stay at home with your new baby, then you may want to look into working from home instead. You may not be able to bring in as much money as working your old job, but it may be enough to get you through.

Pay Down Your Debt First

If you have a large amount of revolving debt on your credit cards, or a hefty car payment or mortgage, make sure you factor those things in. If you were using the income from your regular job to pay off your debt, what is going to happen when you quit? You do not want to be forced to make late payments on anything, ever.

If you know you are in debt, and you are having a baby soon, please make paying down that debt and starting an emergency fund a priority. I say this because if you quit your job, and an emergency comes up, you will have no cushion. The best thing you can do for your family, and your new baby is to be in a strong position financially before you quit your job. What if your baby gets sick? What if you do? You have got to have enough money socked away to not run things down to the wire every month.

The Unexpected Parts of Staying At Home

Having a baby is overwhelming, in every sense of the word. It’s amazing, and there are no words to describe how wonderful it is, but it’s also very stressful. You new little one is going to sleep at most four hours at a time. The constant wake/eat/sleep cycle is enough to confuzzle even the most organized person.

You also have to remember that for nine months you have had various hormones blasting through your system, and after the baby comes those hormones go away. It’s not “in like a lion out like a lamb” either. It’s more like “In like a lion, out like a hurricane”. You can expect to be moody, possibly depressed, and certainly sleep deprived. There will be days where you are lucky to get a shower and eat regularly. It does pass, I promise! But the first few months will be hard. Whether you stay at home or go back to work, get your baby and your family on a schedule as quickly as possible. It will make either transition much more manageable.

Feeling Lonely?

Staying at home with your baby is wonderful, but you could find yourself feeling lonely. I am not a terribly social person, and I still found myself “attacking” my husband when he got home – just for a little conversation!

Make sure that you involve your support network as much as possible. Friends, relatives, in-laws, whoever wants to help, let them help. Especially if you go back to work. If you stay home, make sure you are getting enough social interaction. Loneliness, combined with post-partum depression is not fun, and it is avoidable.

The best advice I can give you about deciding whether or not to quit your job once your baby arrives is this:

Decide well in advance.

If you have nine months to work towards your goal of staying home, then you are going to be a lot more prepared. It is the hardest thing in the whole world to leave your baby somewhere and go off to work. If you know you have to work to provide for your family, or you want to work because you enjoy it – that’s ok! Just make sure that you make the necessary preparations in advance, and give yourself some breathing room. You may want to return to work, but not right away.

If you arrange all of the details before your baby arrives, then everything will go smoothly. You might be able to arrange with your boss to have an extra month off, or if you are staying home, it gives you that much more time to save and get ready.

If you are quitting your job for good, then give your employer as much notice as possible. There is no sense burning bridges! You may need to go back to that job some day, and the best thing you can do is to leave on good terms.

Whatever you decide, don’t let anyone talk you out of it. Other women in particular have very strong feelings about this. Don’t let your mother, your mother in law, or your boss decide what is best for your family. Only you can do that. Just take the time to work through everything before you take the plunge – one way or another, if you plan it well enough everything will be fine.

(Photo: mackro)

Should You Quit Your Job To Stay Home With Your Baby? from personal finance blog Bargaineering.com.

Having a baby is a huge life event, and your entire financial outlook will change because of it. As if the initial cost of having a baby weren’t enough, you also have to ensure you’ve included your new addition to your overall financial plan. Here’s a quick guide on how to include your new baby in your long term financial plans.

Financial Paperwork

Let’s start with your baby’s paperwork:

1. Add your new baby to your insurance policy – This one’s a no-brainer. You do want your insurance company to pay for labor and delivery right? Most insurance companies give you 30 days to officially add your brand new person onto your policy.
2. Get a certified copy (or two) of your baby’s birth certificate – This is as simple as filling out a form and mailing it in. In fact, you can request your baby’s birth certificate just like you would request your own. If your hospital does not give you the forms when you have your baby, then you can visit the CD’s National Center for Health Statistics and select your state to order a certified copy.
3. Get your baby a social security number, and social security card – This is something that your hospital will help you take care of. When you fill out the information for your baby’s birth certificate you will be asked if you want to do the same for the social security office. If for some reason you do not get a chance to do this before your baby comes home, then you can click here for more information on what to do to get your child a social security number.

Once you have your baby’s paperwork in place, then you are ready to begin adding them onto your financial accounts. It will take up to a month for your baby’s social security card to arrive in the mail. Wait until you have it to do the things below because you will need their Social Security number for each of your next steps.

1. List your baby as a beneficiary on your financial accounts – This means that you will have to update any investment accounts you have to reflect the change, including any accounts you hold through your job. Now, you do not have to list your baby as a beneficiary – you can always leave your spouse or significant other as the sole beneficiary.
   
   However, my husband and I did add our daughter onto all of our accounts. We were afraid that if something happened to both of us at once, she might not end up with the money. On most of my financial accounts my daughter is listed as a secondary beneficiary, after my husband.
   
   If you take the time to do this right after your baby is born, instead of waiting, then it will give you greater peace of mind down the road.
2. Have a will drawn up – Yes, I know, no one wants to think about this. But I can give you one good reason (well I could give you about a hundred, but we’ll stick with the most important). Your will is the only chance you have to name guardians other than yourself for your child. If something happened to you and your spouse unexpectedly, who would you want to raise your baby? If you do not decide, then our judicial system will, and that can get ugly, fast. It also gives you the opportunity to clearly spell out what happens to your money and property when you die. All things considered, it is an essential step if you want to secure your child’s future no matter what happens to you.
3. Buy life insurance for yourself and your baby – This also falls into the “I don’t wanna do that” category for some of us, but it’s important. Gerber life policies are dirt cheap for children, and term life insurance is dirt cheap for adults. Buying life insurance doesn’t have to be painful, but it is essential.

Teaching Kids About Money

The next step from here is to decide how you want to teach your child about money as they grow up. In our case I opened a savings account, a Coverdell ESA account, and a general investment account for our daughter. All accounts are jointly in my name with my husband as the beneficiary if anything happens.

I chose to open these accounts for my daughter because I want to teach her that saving and investing are mandatory, not optional. I want her to grow up using them, and understanding them. My husband and I did not learn how to manage our money until relatively late in life. I do not want things to be that way for my daughter.

When she is older, I am going to jointly open a couple of credit cards with her and teach her how to use them. I do not want her to go off to college like I did, sign up for a credit card just to get a free t-shirt, and proceed to ruin her credit. I want her to know that her available credit is there to protect her in an emergency and not something you use just to order a pizza.

Now, I’m not even going to tell you that what I plan to do with my daughter is the only way, or even the correct way to teach a child about money. It’s just what I believe is best right now. If I change my mind as she grows, we will alter our plan.

Some other things you will want to consider:

• Are you going to buy your child their first car? What about insurance?
• Are you going to pay for your child’s college education? In full, part, or not at all?
• How soon do you think your child should get a job?
• What will the “Money rules” be in your house? (Save 10%, 20% or more?)
• How will saving for your child’s future affect your retirement accounts?

You have a unique opportunity with your child – if they grow up learning a thing to be true, then they are likely to continue doing it when they get out on their own.

Now, For The Easy Part…

The most important thing to do right now is to sit down and talk with your spouse about how you want to raise your child. Discuss which types of accounts you will need to do that, and then work together to make it happen. There is no “catch all” strategy for how to plan your future to include your child. But you can be very sure of one thing: Once you have your baby your life will never be the same again, and neither will your money!

How about you? How do you teach your children about money? What did you do to work them into your long term plans?

(Photo: Baby by 44444, Ladybug by ncbrian)

How To Include A Baby In Your Financial Plans from personal finance blog Bargaineering.com.

Having a baby is one of the most incredible experiences in the world.

There are no words to describe the moment you hold your baby in your arms for the first time. When their little eyes look up to you and you realize you made the little tyke. There are no words to describes the feeling of pride the first time you see them turn over, or when they crawl and then eventually walk.

While these memories are priceless, having a child is a very costly endeavor. Most parents expect to pay for the obvious things once the baby arrives like food, diapers, and clothes but they often don’t anticipate “the other stuff.” When we had our daughter, we expected to pay for more food and diapers, but we never planned for “the other stuff.” From the moment I found out I was pregnant though, a seemingly limitless chain of bills started showing up. We were literally supporting our baby from the moment we knew about her. It doesn’t have to be that way.

If you are thinking about having a baby any time soon, here are some of the expenses (”the other stuff”) you’ll want to plan for, even before your baby arrives:

1. Prenatal Care

As scary as it is to think about, most miscarriages happen within the first three months. Chances are your Ob-gyn will not even want to see you until you hit the three month mark because of this. After that, you can expect to go once or twice a month for the next six months, and even more frequently for the final three months.

Every time I went to my Ob/Gyn, it cost me an insurance co-pay of $30. We had hyperactive prenatal doctors so we ended up going even more often than average. Our cost for pre-natal doctors visits over nine months was around $500. Your cost will vary depending on your insurance plan.

2. Prenatal Diet

Your baby is literally depending on you for its nutrients. If you don’t have a healthy diet, then your baby will not get what they need, and that could have long term consequences.

The truth is, we weren’t eating very well when I got pregnant. We ate out once, sometimes twice a week, and ate a lot of beans, rice and eggs otherwise. Doing that kept our before baby food budget to around $300 a month.

After I found out I was pregnant, our food budget literally doubled. We stopped eating out, and I bought fresh organic fruits, vegetables and yogurt. The only food I craved when I was pregnant was steak (which was odd since I am a semi-vegetarian!). The steak was expensive too because I chose to buy only top quality grain-fed beef.

I did not care how much our food ended up costing us, I wanted my baby to have every building block she needed to grow. Over a twelve month period (I breast fed for three months afterward, so we kept our diet the same.) Our food ended up costing us $7,200. Prenatal vitamins added in another $270 over nine months.

3. Maternity Clothes

– I gained around 20 pounds while I was pregnant, so my clothes fit me for most of my pregnancy. However, by the eighth month, there was no containing my belly. I had to face facts and invest in a few good quality maternity clothes. I bought a week’s worth of clothes as cheaply as possible. I also used my husband’s shirts and bought things like hip-hugger pants that I could wear after my baby. The total cost of my maternity clothes was around $400. If you’re careful you might be able to get by cheaper, but it could easily cost more depending on your needs. Try to maximize sales whenever you can!

4. Baby Clothes & Supplies

We were very blessed because our friends and family gave us nearly everything our daughter would need for her first few months. If you don’t have a strong supportive network, then this will be a real expense.

Wal-Mart and Target have the most reasonably priced baby clothes. If I had to put a price on what we were given I would say that it amounted to easily $800 to $1000 worth of diapers, clothes, shampoo, and supplies. Again, we had an extremely generous family, who put all they had into helping us prepare for our baby. In retrospect, If I were the one paying for the items, I would have spent around $400 total on clothes and supplies for my daughter’s first few months – and that would have been plenty.

5. Nursery & Travel Items

The crib for our daughter was $500. Her mattress was $100. We bought a crib that would turn into a toddler bed, and eventually a full sized bed as she grew. Her car seat and stroller ran us about $400 – again because we bought for the long term and wanted something that would last through several children if necessary. You can definitely do this cheaper than we did! The total cost for her nursery was around $1,500 after decorations.

6. The Big Day(s): Hospital and Delivery Costs

How much this ends up costing you will depend on your insurance, how difficult your labor is, and how well everything goes.

In my case, nothing was simple. I spent two days in the hospital being induced and ended up with a c-section. My daughter had a fever when she was born, so she spent a week in the hospital on antibiotics undergoing a lot of tests. (She was fine, thank God!) They kept me for four days after my surgery. I can honestly say that for a month after we came home I dreaded going to the mailbox and pulling those medical bills out!

The total cost for her delivery was nearly $4000.

7. The Paperwork

After my daughter was born, we did have to take care of some paperwork. Particularly ordering several copies of her birth certificates. This was another unexpected cost. I’m not sure why I thought that the hospital would provide us with one – they didn’t. They sent her birth records off and we had to order an official copy. Those were $10 each, and we ordered 3, so we $30 spent on her paperwork.

8. The Aftermath

In the first few months following her delivery she and I both went back to the doctor a couple of times for routine checkups. This was not a huge expense, but it was one I did not expect. The follow-up visits probably ran us around $150.

From conception to birth, our daughter cost us about $14,000. Fourteen thousand dollars. Oh, and that does not even take into account the diapers or the eventual formula costs once I went back to work. It also does not include childcare, which thankfully, we did not have to get.

If you are considering having a baby, please make sure that you get a hefty savings account going before you take the plunge. Many of these costs we had not planned for, and that made it more difficult than it had to be. When we planned out our finances before getting pregnant, we always planned out what we thought the costs would be after we had her, and we did not take into account what it would cost just to get her to delivery!

I am very sure that if I had it to do over again, I could do it for less money. I think that I went into it from the mindset of doing what I thought was right for my baby, and the finances took a backseat. That being said though, my daughter’s birth story is an excellent example of how having a baby can easily cost you a fortune – so it’s something to think about.

How about you? Do you have children? What would you say it cost you and your spouse to have your baby? Leave us a comment below!

Babies Are Expensive! Total Cost of Having A Baby from personal finance blog Bargaineering.com.