For additional details, contact:
Amy Lewis
Strategy Communications
Phone: 619-713-0622
Email: Amy@scpublicrelations.com

Gary Symington
Debt-Free America
Phone: 888-268-2926
Email: gary@debtfreeamerica.com

Money Tips For Stay-At-Home Moms
What You Need To Consider Before a Change in Career

SAN DIEGO, April 28, 2008 – So, you have decided to put your career on hold and take on the non-stop, paycheck-free task of being a stay at home mom. While there are many benefits to being a stay at home mom, you may be concerned about whether you will be able to live off only one income, the impact it will have on your career when you return and the social implications it could potentially have. Financially, it may seem like it is already difficult enough with two salaries to pay the bills, but there are ways to make it through being a stay at home mom, without breaking the bank. These steps can help you develop a successful financial plan; maintain your career path and a normal social life, all while enjoying the benefits of staying home with your kids.

Debt-Free America offers the following tips for women considering to begin the new challenging career as a stay-at-home mom:

Practice before jumping in
Before you leave your job and begin living on a single salary, do a practice run first to see what it is like. Take your paycheck and use the opportunity to start an emergency savings account, using only your spouse’s paycheck to pay the bills. It is hard to imagine how you will manage on just one income without actually trying it, so before you leave your job, take a few months to ensure that this change will be economically viable before making any permanent lifestyle changes.

Preparing your budget
It is difficult determining what all your expenses are, but compile them as best you can. Look at the essentials, such as mortgage payments, insurance premiums, utilities, food, etc. A rule of thumb is that these are ideally kept to 60% of your income. The remainder of the pie needs to pay for things like short and long term savings goals, retirement contributions, ‘fun money’ and maintenance of your emergency savings. The proportions of these will vary from family to family, but each of these expenses needs to be considered when doing you budget. While 60% may seem like far too little to pay for all your basic expenses, it is a good goal to keep in mind. And make sure you are not forced to scrimp on your retirement savings.

Hedging your Bets
Make sure you look into your spouse’s insurance benefits. With only one income, you need to make sure that you are well insured to limit any large scale expenses that may arise. The better insured you are, the more secure you are in your job as a stay at home mom. Make sure your spouse’s health insurance provides adequate coverage and reasonable copayments for you and your child. Check to see if your spouse’s company offers a flexible spending account. Flexible spending accounts are tax advantaged accounts that allow you to withdraw pretax dollars to cover co-payments, medications and child care expenses. If your spouse’s company does not offer one of these accounts, then look into high deductible insurance coverage which allows you to get a Health Savings Account on your own. From an account like this, you can withdraw tax advantaged money to cover medical expenses in much the same way. An added layer of security you may want to consider is term life insurance. Term life insurance is relatively inexpensive and protects your children financially in case anything should happen to you. When selecting a policy, consider all of your child’s expenses, not only in the short term, but in the long term as well.

Goodbye bonuses, vacation days and adult interaction
While you may be able to overcome the financial issues of being a stay at home mom, the other hard part for stay at home moms is the lack of social interaction they feel with other adults. You need to consider this when developing your financial plan. It is often referred to as the “second shift”. A mother’s job does not end at 5pm like many other jobs do, and as such, it is easy for childcare to occupy the entirety of a mother’s life. It is important that your spouse is able to be home during certain hours to relieve you, so you can pursue social activities outside the home. There are many different websites which advertise local social events for mothers. Not only are these events a great chance to get out of the house and be social for a while, but they are a good chance to see how other moms are beating the financial single-income crunch.

Keep walking that career path
Studies show that mothers who take time off their careers to take care of children, make 20 percent less than other women who have not gone through a similar employment gap. It is difficult to develop professionally while being a stay at home mom, but ensuring that you stay somewhat connected to your career while out of paid work will minimize the overall impact that the time off has on your career. While you are not working, which means no paycheck, you should never completely give up on your career as there are professional and personal benefits to staying involved:

• Attend Conferences pertaining to your field – Staying in touch with the industry you are in means that not only will it be easier to reenter the field when your children have grown, but depending on your field, it also could allow you to start working out of your home when the kids start school and you have sufficient time.
• Start doing research around issues pertaining to your career – Although you may not end up getting published, it is something to put on your resume to minimize your employment gap.
• There are many different small businesses you can start from home, which are designed with stay at home moms in mind. Most moms find they have no time for this sort of the thing in the beginning, but as time goes on, and children become more independent, you may find you want this sort of project. They require little time and you work on your own schedule. This not only brings in a small income for the household, but it gives you an opportunity to pursue something other than childcare and to practice your business skills.

Not only will doing these sort of things increase your potential salary when you return to work, it will provide you with a sense of professional development that a lot of stay at home moms claim to miss.

If you are considering staying at home with your child, then you probably have already considered the benefits of being a stay at home mom. The financial drawbacks can be a big concern, but with help, you can address those issues and develop an effective financial plan that allows you to stay home with your child and still be financially secure. It begins with planning and understanding your expenses, protecting yourself against risk and then ensuring that you can enjoy your new role as a stay at home mom without completely cutting off your social life or career. Debt-Free America can offer services and council you on developing a successful financial plan to allow you the freedom to be a stay at home mom.

WHO: Debt-Free America
WHAT: Money Tips For Moms: What you should consider before a change in career
WHEN: Interviews are available immediately and ongoing
WHERE: In-studio or phone interviews with Debt-Free America

Debt-Free America is a 501(c)3 non-profit, community service organization offering confidential and professional credit counseling, debt management programs, and financial education to consumers nationwide. Debt-Free America is dedicated to providing FREE services to help financially distressed families and individuals effectively manage their personal finances. The Board members and operations staff have a long-term commitment to helping anyone in debt crisis, and even those not in a debt crisis. Debt-Free America has been in the business since 1997 and is now serving over 17,500 clients nationwide.

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