What do you think about the idea of a two income trap? - Page 3 - Mothering Forums

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#61 of 147 Old 01-26-2009, 05:31 PM
 
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I feel like a lot of the books and analysis that came out over the past ten years or so regarding two-income and one-income families are going to look quaint and antiquated in ten years due to the financial collapse. I feel that the cultural discussion around working parents is going to be permanently changed by what I think is going to be a very long period of economic difficulty.

For instance, take the "parent in reserve" concept from the Two-Income Trap. It used to be that going out and getting any job (e.g., a "scraping by" job) was generally fairly feasible even for women who'd been out of the workforce for a long time. It wouldn't be glamorous, but it would let the family scrape by for a little while. But I think that's changing as more primary earners are out of work and willing to do whatever it takes to get a job. In that case, employers who have the ability to hire will generally take the person who has been most recently employed.

I feel like a lot of the discussion going forward about working or SAH is going to be fundamentally shaped by the economic crisis. Already, some of the books and articles I remember reading a few years ago seem antiquated because the "choice" element of having two or one income has been removed for so many families.
I agree. When I worked at Walmart a few years back, a lot of my coworkers were people taking on a second job in order to make ends meet, or people who had been laid off of a higher paying job trying to scrape by. There were also quite a few former SAHM's just coming back into the workforce. I think most people who showed up and were willing to work were hired. Walmart-type jobs helped these folks to get by until they found something better. In the current situation, there will be a lot more competition for these service sector jobs that were formerly there for whoever needed them.

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#62 of 147 Old 01-26-2009, 05:31 PM - Thread Starter
 
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I feel like a lot of the books and analysis that came out over the past ten years or so regarding two-income and one-income families are going to look quaint and antiquated in ten years due to the financial collapse. I feel that the cultural discussion around working parents is going to be permanently changed by what I think is going to be a very long period of economic difficulty.

For instance, take the "parent in reserve" concept from the Two-Income Trap. It used to be that going out and getting any job (e.g., a "scraping by" job) was generally fairly feasible even for women who'd been out of the workforce for a long time. It wouldn't be glamorous, but it would let the family scrape by for a little while. But I think that's changing as more primary earners are out of work and willing to do whatever it takes to get a job. In that case, employers who have the ability to hire will generally take the person who has been most recently employed.

I feel like a lot of the discussion going forward about working or SAH is going to be fundamentally shaped by the economic crisis. Already, some of the books and articles I remember reading a few years ago seem antiquated because the "choice" element of having two or one income has been removed for so many families.


YES! I think this is very, very true. Well put. I think the changing economics are going to change a lot of the things we thought we knew, and the thinking of experts on these matters.
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#63 of 147 Old 01-26-2009, 05:32 PM
 
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I have done pretty much everything in a self-sufficient way. College, getting established, motherhood. It was all through my own work (and DH's) and saving and being frugal. There were definitely no hand outs and the only breaks were being offered positions we interviewed for. It wasn't easy come, so for me, I think I was more careful about things.

We've had a few set backs, but I think overall we've been pretty frugal and that has paid off.
I had to do it all myself as well, while subsidizing my younger sisters. It makes a huge difference to attitude - there is no such thing as easy money when you've earned every penny of it yourself.
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#64 of 147 Old 01-26-2009, 05:32 PM - Thread Starter
 
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I agree. When I worked at Walmart a few years back, a lot of my coworkers were people taking on a second job in order to make ends meet, or people who had been laid off of a higher paying job trying to scrape by. There were also quite a few former SAHM's just coming back into the workforce. I think most people who showed up and were willing to work were hired. Walmart-type jobs helped these folks to get by until they found something better. In the current situation, there will be a lot more competition for these service sector jobs that were formerly there for whoever needed them.
Yes. Depressing, but true.
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#65 of 147 Old 01-26-2009, 05:35 PM - Thread Starter
 
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I had to do it all myself as well, while subsidizing my younger sisters. It makes a huge difference to attitude - there is no such thing as easy money when you've earned every penny of it yourself.
Absolutely.

In some ways, my attitude about this is very good. I feel pretty confident about my ability to get a job, even when it's competitive out there, and I'm pretty proud of all that I've been able to accomplish and do.

But in some ways it is draining and demoralizing. I've been frugal. I have saved. I did work very hard to establish a career. I delayed having children. I put myself through school to make a better life and have more opportunity. And I see a lot of examples out there where luck has more to do with it than proper planning and hard work. Such is life, though, I guess. And I do know that if I hadn't done the things I've done, I'd be so much worse off, with even fewer options. So, no regrets...just want to make sure I'm doing the right things going forward.
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#66 of 147 Old 01-26-2009, 06:23 PM
 
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I agree about luck. I think we are VERY lucky in that none of us have health problems. (Knock on wood.) We barely even get colds. But if one of us were to become seriously ill, that would be it. We'd be bankrupted immediately. I don't know how we got so lucky, but I am thankful for it.

I feel bad for people with bad health. My stepmom just recovered from leukemia for the third time, recently. It left them in serious debt and she and my dad lost their house. It had nothing to do with poor planning, because they had insurance, as much as she could get with her health history.
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#67 of 147 Old 01-26-2009, 06:32 PM
 
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I know that DH and I would only be breaking even if we had 2 incomes. We wouldn't qualify for medicaid anymore. Basically the extra income would only cover medical/dental insurance, childcare and work expenses. It didn't make sense to put extra stress on my marriage like that. Even if DH and I worked opposite shifts (which we have) it was still extremely difficult.

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#68 of 147 Old 01-26-2009, 07:19 PM
 
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This is more or less where we are, too. Right now, we are *just* under the limit for the Earned Income Credit. If I were to go work, we'd lose that. We are also $12 per year under the WIC limit. WIC provides us with a minimum of $100 per month in food. I had SIL, who is a tax preparer/accounting student run the numbers for me, and she figured that if I got a job making as much as DH makes, after taxes and the loss of WIC, I'd net about $700 per month. For 40 hours a week.

Childcare tends toward expensive here, and $4 per hour is about the average. Even if DH and I were able to engage in creative scheduling, we'd still need a good 20 hours a week of childcare. That's a minimum of $320 per month, bringing my net to a dismal $380 per month.

Considering that we'd need a more reliable second vehicle in order for me to go to work, there goes that $380- I'd be working for a car payment and full coverage insurance. And I'd see my kids a whole lot less. It's a wash, financially, so I may as well stay home, at least for the time being.

Trying to turn hearts and minds toward universal healthcare, one post at a time.
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#69 of 147 Old 01-26-2009, 07:46 PM
 
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I know I wouldn't be able to afford to work without my husband to either make money for daycare or watch our daughter himself. Daycare is 1/4 of my take home and it is bargin basement in-home care. I would still make way too much for any assistance though. For me, there is a kind of trap without my husband until my daughter is old enough for school.

As an aside, this is one of the reasons that we we absolutely have to have life insurance.
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#70 of 147 Old 01-26-2009, 09:37 PM
 
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Like a few other's said, it wouldn't make any sense for me to work. When I was pregnant with our first and decided to stay home, I made a whole $11 an hour. With four kids, it would probably cost me money to work, just by deducting child care. Not that I want to or have a need to. Luckily, DH makes enough money that we live comfortably. I guess that could be our 'one income' trap, because unless I worked nights and never slept, we can't afford to have two parents working outside the home.

Now, I can definitely see how things could have been different in our situation. We started having babies young. Neither of us had a college degree and we certainly didn't have much expenses or a mortgage. If we had waited longer, I bet we both would have gone on to college, graduated, got average paying jobs and likely have a good amount of student loans. I imagine we would have lived a life that was dependant on both of our incomes and have a hard time imagining reducing it to one. I see it with other people I know. They buy a house based on what both partners earn, have two car payments, cc bills, other loans, etc., and while they may not be completly broke every month, there certainly is no way they could cut their income in half and still have a roof over their head.

we lived in shady places, went w/o things we wanted (including savings), went w/o things we needed at times (health insurance, for one) and struggled on and off for about 6 years. Having me work, really wouldn't have made any difference, again because of childcare (we would not have qualified for assistance). But you know what? It was all entirely worth it and we always had a place to live and food to eat. and now, we have it very good --because of my DH's hard work and effort-- despite not going to college. I do feel for those people who are stuck in the situation where they really do need two incomes... but I know there are plenty of folks who felt bad for me, considering we were low income for some time and I really didn't have the choice to work and contribute financially.

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#71 of 147 Old 01-26-2009, 09:49 PM - Thread Starter
 
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I agree about luck. I think we are VERY lucky in that none of us have health problems. (Knock on wood.) We barely even get colds. But if one of us were to become seriously ill, that would be it. We'd be bankrupted immediately. I don't know how we got so lucky, but I am thankful for it.

I feel bad for people with bad health. My stepmom just recovered from leukemia for the third time, recently. It left them in serious debt and she and my dad lost their house. It had nothing to do with poor planning, because they had insurance, as much as she could get with her health history.
Health is the important determinant. Very good points. I agree completely.
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#72 of 147 Old 01-26-2009, 09:59 PM - Thread Starter
 
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Daycare is 1/4 of my take home and it is bargin basement in-home care. I would still make way too much for any assistance though.
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I had SIL, who is a tax preparer/accounting student run the numbers for me, and she figured that if I got a job making as much as DH makes, after taxes and the loss of WIC, I'd net about $700 per month. For 40 hours a week.
Darn, I thought I was doing pretty good with my income, but I net less than $700 after expenses (child care, etc). Childcare is way more than 1/4 my income. It's a little over half, and I also live in a high tax area. Two incomes most definitely puts us in a higher tax bracket.

I make good money, at least it was good money before I had a baby, and now have child care expenses.

For us, though, we really need the >$700 net that I bring in to make ends meet.

One thing I read in the Opting Out book (great book) was that women often mistakingly subtract all the child care expenses from just their paycheck not the family's combined paychecks, even though it's a cost that should be paid by both parents. (When I look at it this way, I feel much better about my net).

And they often forget to calculate in retirement, social security, and health insurance.

The other thing (and this is DH's point mainly) is that I'm his back up in case he loses his job, and he's mine. DH does not want to be the sole breadwinner in our family. He wants me to help him with the income, with retirement, with job security.

We're so close to being able to swing it, that I suppose DH and I could justify it either way...working or SAHPing...it's not a clear thing for us financially, at least not while there are child expenses. We don't make enough on one income to pay basics, but we make more than enough on two.
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#73 of 147 Old 01-26-2009, 10:07 PM
 
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Darn, I thought I was doing pretty good with my income, but I net less than $700 after expenses (child care, etc). Childcare is way more than 1/4 my income. It's a little over half, and I also live in a high tax area. Two incomes most definitely puts us in a higher tax bracket.

I make good money, at least it was good money before I had a baby, and now have child care expenses.

For us, though, we really need the >$700 net that I bring in to make ends meet.

.
I haven't read either book, just my disclaimer. But, to me, this wouldn't be worth working. It's $175 per week, I could make more than that doing a home daycare program. But I was not thinking about the retirement aspect or other job perks. I guess for us, I assume that if we can make it now on one income, we should be okay later on with one retirement income. ya know? but in all honesty, I can see myself going back to school and eventually working once the kids are much older. So, we will have a chance to save money, including for retirement because it will all essentially be extra income that we survived just fine without before.

eta: I do kinda get the part about deducting the childcare from total income of both partners, but even then, it still ends up being the same amount of net $ each month, right? For us, even if we only had 1-2 kids, it still wouldn't be worth it (again, IMO). And it does make sense to deduct it from my potential earnings because if I wasnt' going back to work, we wouldn't have a need for daycare.

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#74 of 147 Old 01-26-2009, 10:18 PM - Thread Starter
 
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I haven't read either book, just my disclaimer. But, to me, this wouldn't be worth working. It's $175 per week, I could make more than that doing a home daycare program. But I was not thinking about the retirement aspect or other job perks. I guess for us, I assume that if we can make it now on one income, we should be okay later on with one retirement income. ya know? but in all honesty, I can see myself going back to school and eventually working once the kids are much older. So, we will have a chance to save money, including for retirement because it will all essentially be extra income that we survived just fine without before.

eta: I do kinda get the part about deducting the childcare from total income of both partners, but even then, it still ends up being the same amount of net $ each month, right? For us, even if we only had 1-2 kids, it still wouldn't be worth it (again, IMO). And it does make sense to deduct it from my potential earnings because if I wasnt' going back to work, we wouldn't have a need for daycare.
Oh, I totally hear you!

Trust me, there are many days where I wonder what am I doing this for? This is too much work and stress for this amount of money!!

But, for me, that $175 week is needed for our budget, and helpful, even if it's not that much money. Actually, I net less than that after child care, etc expenses.

But I won't be paying child care forever, and, in the mean time, I'm gaining more job experience and hopefully will get salary increases eventually from that. So, by the time my child is in school, I hope to make an even better salary.

And retirement is a big part of the reason I keep at it. Also, benefits. I get great benefits and they come in handy. And given some of the dynamics of my marriage, I really need my own income and job history to rely on.

And, really, DH just does not and never has and never will support me being a SAHP. It used to bug the heck out of me, but as our child gets a bit older, it's not as big of a deal (I suppose anyway...I still struggle a bit with the sadness and the disappointment and the guilt). I used to try to figure out how to make it happen, but then I just decided I tried long enough, and without DH's support, it wasn't even healthy to try anymore.

Mostly, though, I think the retirement issue is a bigger deal for older parents. I delayed having kids. I don't have that many more years ahead of me to save for retirement, and with this economy, our retirement is way down (like everybody's).

If I had had children younger, perhaps I could think about saving years down the road. In some ways, there are good reasons to have kids younger, and some good reasons to have at an older, more established age. Pros and cons. Such is life!
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#75 of 147 Old 01-26-2009, 10:42 PM
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Darn, I thought I was doing pretty good with my income, but I net less than $700 after expenses (child care, etc). Childcare is way more than 1/4 my income. It's a little over half, and I also live in a high tax area. Two incomes most definitely puts us in a higher tax bracket.

I make good money, at least it was good money before I had a baby, and now have child care expenses.

For us, though, we really need the >$700 net that I bring in to make ends meet.

One thing I read in the Opting Out book (great book) was that women often mistakingly subtract all the child care expenses from just their paycheck not the family's combined paychecks, even though it's a cost that should be paid by both parents.
But that is the correct way to calculate it when comparing single income to dual income households. If mom (or dad) stayed home, there would be no daycare expense. So the proper way to determine the net effect of a second smaller income is to deduct all of the expenses associated with THAT income. That would include childcare, wardrobe expenses, a second commuter vehicle, convenience foods, meals out, "guilt" presents, etc.

But if that $700 net is truly needed in your household, then losing 1/2 of your gross to childcare expenses is worth it.
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#76 of 147 Old 01-26-2009, 10:50 PM
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I don't know if I agree with this.

On the first point, when I compare myself to say, my grandmother and great grandmother, the difference I see is that they owned land (purchased on one salary, their husbands'). Both owned over 10 acres their whole lives. They had room for a garden large enough to feed the family and livestock.

I do not have that room. I can't have a garden where I live, and you can't feed the family easily with contain gardening in a small space. And I certainly do not have any space for livestock.

Granted I have job skills that bring in more money than homemaking could ever save, but even if I wanted to be a homemaker like my grandmother, it is not logistically possible.

On the second point, it's not simply each families' priority where they live. Much of that decision is at the mercy of the job market and dependent on what career you are in. Certain careers are confirmed to certain geographic areas, a lot of times.

Wher I live, the price of houses and land just outside the metro area (or with an hour communte) are exorbitantly expensive. Just in the metro area, one could expect to pay $400k for a 1950s fixer upper. For any amount of land outside the metro area it would be $500k on up.

Also, coming from the background I came from, and paying for college all on my own, the amount of student loans I had necessitated getting a job right away and jobs were in a metro area with a high cost of living. Without a degree, though, I'd have been SOL.
But it isn't as if you wake up one day and are handed a slip of paper that tells you what job you will do. You get to pick your career path, and one of the things to consider is the COL of metro areas where your career is in demand.

That was the driving factor of my husband's career choice, as well as mine. I can usually find a bookkeeping or accounting assistant position in almost any job market. Barring that, I'm an excellent secretary. My husband, likewise, has the training to work on diesel engines or in the water department of any municipality.
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#77 of 147 Old 01-26-2009, 11:02 PM
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I disagree: I think it is more appropriate to allocate the cost of childcare based on the relative value of the service to each parent. The opportunity cost of having to provide childcare for a parent earning 50K annually is higher than the opportunity cost of same for a parent earning 25K annually. It makes no sense to allocate the full cost of childcare to the lower-earning parent, for the purpose of estimating each individual's "net" wages. No more sense than it would to allocate the full cost of groceries to the person who was principally responsible for grocery shopping. Both types of expenses are incurred by both parents - not just by one or the other - when both parents are unable to provide care directly.

ETA: I think the "two-income trap" idea gets people fired up about the wrong thing: women working (or not), while ignoring the big issue, the stagnation of wages in the U.S. over the past 30 years, despite increases in productivity. Let's hope the next eight years can mark a reversal in the trend.
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#78 of 147 Old 01-26-2009, 11:02 PM - Thread Starter
 
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But that is the correct way to calculate it when comparing single income to dual income households. If mom (or dad) stayed home, there would be no daycare expense. So the proper way to determine the net effect of a second smaller income is to deduct all of the expenses associated with THAT income. That would include childcare, wardrobe expenses, a second commuter vehicle, convenience foods, meals out, "guilt" presents, etc.

But if that $700 net is truly needed in your household, then losing 1/2 of your gross to childcare expenses is worth it.
The author of Opting Out talked about that. She said of the women she interviewed for her research (she is a sociology professor) nearly all subtracted child care expenses from just their paycheck and at the same time, most did not look at factors like retirement, pensions, employee match, social security credit, and...let's see...something else...benefits such as health insurance, life insurance...and also job experience.

I've also seen the calculators on places like Money magazine where they run the cost of work (meals out, wardrobe, second vehicle, etc) versus staying at home.

I've not found that working makes me spend more on all those things. Wardrobe, yes, a little. Transportation, no. Meals out, no. Guilt presents, definitely not. A working mom definitely does not have to spend extra on guilt presents, convenience food, etc, but in reality it probably does happen.

One thing I did read is that with child care factored in, it usually did not make financial sense for a mother making under $30k ($15 per hour) to work, while generally it did make sense for a mother making $30k or more yearly to work.

This is an old figure, it might be more or less now, given this incredibly fast changing and fickle economy.
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#79 of 147 Old 01-26-2009, 11:07 PM - Thread Starter
 
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But if that $700 net is truly needed in your household, then losing 1/2 of your gross to childcare expenses is worth it.
Very true.

And it's important to remember that most likely those child care expenses are only temporary until children are school age (unless a private school is needed).
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#80 of 147 Old 01-26-2009, 11:13 PM - Thread Starter
 
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But it isn't as if you wake up one day and are handed a slip of paper that tells you what job you will do. You get to pick your career path, and one of the things to consider is the COL of metro areas where your career is in demand.

That was the driving factor of my husband's career choice, as well as mine. I can usually find a bookkeeping or accounting assistant position in almost any job market. Barring that, I'm an excellent secretary. My husband, likewise, has the training to work on diesel engines or in the water department of any municipality.
No, but you can be handed a slip of paper that tells you you no longer have a job in the area where you live (lay off) or that your job in your field no longer really exists in the country in which you live (outsourcing), etc.

When I think back about the career advice handed out in high school, and in college about what fields were hot and lucatrive and hiring, it was different than the career advice being given out today.

There are some fields that are needed everywhere (medicine is one, public safety is another, law and teaching are others).

But pay varies greatly. Demand varies greatly. And often you have to go where the jobs are. And often that is where cost of living is higher.

I don't think we can live anywhere we choose...it would be tough for DH to find a job in certain markets. I sometimes wonder if we could even downsize, and move to a less expensive area. Would we be able to get jobs there? Or would potential employers overlook us as being too qualified? I'm not sure. We might not even be qualified for work that disconnected from our fields.
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#81 of 147 Old 01-26-2009, 11:18 PM - Thread Starter
 
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Both types of expenses are incurred by both parents - not just by one or the other - when both parents are unable to provide care directly.

ETA: I think the "two-income trap" idea gets people fired up about the wrong thing: women working (or not), while ignoring the big issue, the stagnation of wages in the U.S. over the past 30 years, despite increases in productivity. Let's hope the next eight years can mark a reversal in the trend.
ITA.

Yes! And that's why I think the two income trap doesn't exist. Sure, there are people who spend to the brink and outspend their ability to live on one income.

But mostly it's wage stagnation, and price inflation.

And, yes, let's hope that trend starts to change. Because wage stagnation and inflation and bubble and bust markets have made things so cruddy.
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But it isn't as if you wake up one day and are handed a slip of paper that tells you what job you will do. You get to pick your career path, and one of the things to consider is the COL of metro areas where your career is in demand.

That was the driving factor of my husband's career choice, as well as mine. I can usually find a bookkeeping or accounting assistant position in almost any job market. Barring that, I'm an excellent secretary. My husband, likewise, has the training to work on diesel engines or in the water department of any municipality.
No but fields do change, my dh is in his 40's and after 20 years in journalism the field has changed. When he was in college back in the 80's no one could have imagined the technology that we have now and how its taking journalism. Yeah, work still exists for him but the wages are ridiculous and considering the way things are going, we both doubt its going to get better.

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No, but you can be handed a slip of paper that tells you you no longer have a job in the area where you live (lay off) or that your job in your field no longer really exists in the country in which you live (outsourcing), etc.

When I think back about the career advice handed out in high school, and in college about what fields were hot and lucatrive and hiring, it was different than the career advice being given out today.

There are some fields that are needed everywhere (medicine is one, public safety is another, law and teaching are others).

But pay varies greatly. Demand varies greatly. And often you have to go where the jobs are. And often that is where cost of living is higher.

I don't think we can live anywhere we choose...it would be tough for DH to find a job in certain markets. I sometimes wonder if we could even downsize, and move to a less expensive area. Would we be able to get jobs there? Or would potential employers overlook us as being too qualified? I'm not sure. We might not even be qualified for work that disconnected from our fields.
ITA w/you.

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I disagree: I think it is more appropriate to allocate the cost of childcare based on the relative value of the service to each parent. The opportunity cost of having to provide childcare for a parent earning 50K annually is higher than the opportunity cost of same for a parent earning 25K annually. It makes no sense to allocate the full cost of childcare to the lower-earning parent, for the purpose of estimating each individual's "net" wages. No more sense than it would to allocate the full cost of groceries to the person who was principally responsible for grocery shopping. Both types of expenses are incurred by both parents - not just by one or the other - when both parents are unable to provide care directly.

ETA: I think the "two-income trap" idea gets people fired up about the wrong thing: women working (or not), while ignoring the big issue, the stagnation of wages in the U.S. over the past 30 years, despite increases in productivity. Let's hope the next eight years can mark a reversal in the trend.
I totally agree with you 100% . We aren't focusing on the larger issues which is that incomes have not kept pace with the true cost of living. For every family IMO that can make it with just one income there are probably more than cannot... I know we can't and we have no big tv's, nice cars, or any of the things that commonly get thrown out as reasons why folks are tied to 2 jobs. What I do have is a boatload of student loan debt (why is school so costly? another post ) and a kid who is 1 year away from college and we are middle aged with no retirement plans.

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The author of Opting Out talked about that. She said of the women she interviewed for her research (she is a sociology professor) nearly all subtracted child care expenses from just their paycheck and at the same time, most did not look at factors like retirement, pensions, employee match, social security credit, and...let's see...something else...benefits such as health insurance, life insurance...and also job experience.

I've also seen the calculators on places like Money magazine where they run the cost of work (meals out, wardrobe, second vehicle, etc) versus staying at home.

I've not found that working makes me spend more on all those things. Wardrobe, yes, a little. Transportation, no. Meals out, no. Guilt presents, definitely not. A working mom definitely does not have to spend extra on guilt presents, convenience food, etc, but in reality it probably does happen.

One thing I did read is that with child care factored in, it usually did not make financial sense for a mother making under $30k ($15 per hour) to work, while generally it did make sense for a mother making $30k or more yearly to work.

This is an old figure, it might be more or less now, given this incredibly fast changing and fickle economy.
When I calculate things like that for my family, I work off of the assumptions that fit our family. That means that all of those things (insurance, retirement, etc) are all based on my husband's job, so, none of those "points" apply to me. We also do not purchase life insurance through an employer, because we want a policy that will still be there should we leave the job (through any means.)
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No, but you can be handed a slip of paper that tells you you no longer have a job in the area where you live (lay off) or that your job in your field no longer really exists in the country in which you live (outsourcing), etc.

When I think back about the career advice handed out in high school, and in college about what fields were hot and lucatrive and hiring, it was different than the career advice being given out today.

There are some fields that are needed everywhere (medicine is one, public safety is another, law and teaching are others).

But pay varies greatly. Demand varies greatly. And often you have to go where the jobs are. And often that is where cost of living is higher.

I don't think we can live anywhere we choose...it would be tough for DH to find a job in certain markets. I sometimes wonder if we could even downsize, and move to a less expensive area. Would we be able to get jobs there? Or would potential employers overlook us as being too qualified? I'm not sure. We might not even be qualified for work that disconnected from our fields.
That's the great thing about my husband's training. We can live in pretty much any city/town. Almost every municipality has water service, and all those that have it need technicians to monitor the water supply and repair the lines. And it is a very good paying job, with stability. Cities will let office workers and cops go before they let their water operators go.
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#85 of 147 Old 01-27-2009, 12:09 AM
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No but fields do change, my dh is in his 40's and after 20 years in journalism the field has changed. When he was in college back in the 80's no one could have imagined the technology that we have now and how its taking journalism. Yeah, work still exists for him but the wages are ridiculous and considering the way things are going, we both doubt its going to get better.

No offense, but journalism is a very good thing, but it's not an essential service.

People who went into non-essential service industry jobs, thinking that they couldn't be outsourced are finding themselves losing jobs either through "insourcing" or through clients cutting back.

A typical example is massage. In this economy, there are very few massage therapists making what their schools claimed they could earn, due to the reduction in discretionary spending. Likewise, manicurists are making less money due to the economy and a flood of immigrant owned and operated shops that offer similar services for less than most Americans are willing to work for. There are other service jobs that Americans have opted to do themselves: mow the lawn, change the oil, clean the gutters, etc.

However, people who went into essential service jobs are finding themselves pretty secure. No matter how bad the economy gets, people still need to heat their homes (furnace repair), drive to work (auto repair), and they need clean water piped to their homes (water operator).
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No but fields do change, my dh is in his 40's and after 20 years in journalism the field has changed. When he was in college back in the 80's no one could have imagined the technology that we have now and how its taking journalism. Yeah, work still exists for him but the wages are ridiculous and considering the way things are going, we both doubt its going to get better.



ITA w/you.



I totally agree with you 100% . We aren't focusing on the larger issues which is that incomes have not kept pace with the true cost of living. For every family IMO that can make it with just one income there are probably more than cannot... I know we can't and we have no big tv's, nice cars, or any of the things that commonly get thrown out as reasons why folks are tied to 2 jobs. What I do have is a boatload of student loan debt (why is school so costly? another post ) and a kid who is 1 year away from college and we are middle aged with no retirement plans.

Shay

I agree with all of this, wholeheartedly!

And, journalism is one of those fields that has changed the most. So many journalists are being laid off - it's very sad. Newspapers that have been around forever are going out of business. The print media field has changed drastically.

But it's not the only field. I think the computer programming field has changed a lot, too, in the past 15 years.
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#87 of 147 Old 01-27-2009, 12:18 AM - Thread Starter
 
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No offense, but journalism is a very good thing, but it's not an essential service.

People who went into non-essential service industry jobs, thinking that they couldn't be outsourced are finding themselves losing jobs either through "insourcing" or through clients cutting back.

A typical example is massage. In this economy, there are very few massage therapists making what their schools claimed they could earn, due to the reduction in discretionary spending. Likewise, manicurists are making less money due to the economy and a flood of immigrant owned and operated shops that offer similar services for less than most Americans are willing to work for. There are other service jobs that Americans have opted to do themselves: mow the lawn, change the oil, clean the gutters, etc.

However, people who went into essential service jobs are finding themselves pretty secure. No matter how bad the economy gets, people still need to heat their homes (furnace repair), drive to work (auto repair), and they need clean water piped to their homes (water operator).
Well, but the point is whole fields have changed in ways no one expected due to technology, and outsourcing.

In the book "The World is Flat" by Thomas Friedman (New York Times columnist), the author talks about fields such as software engineering which was a highly paying, highly skilled field that was in high demand 15 and 20 years ago. Many of those jobs have been outsourced. In some areas, people with degrees and experience in that field have trouble finding jobs. Aerospace was another field with similar changes.

The same is true with journalism. And accounting and medical technology are now the fields often being outsourced.

The economy has changed in ways no one expected.

And when I think back to high school and college, guidance counselors and teachers didn't encourage college prep kids to go into service industry jobs...it was all about high tech and science back then.

I'm curious what high school guidance counselors advise now...
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#88 of 147 Old 01-27-2009, 12:22 AM - Thread Starter
 
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People who went into non-essential service industry jobs, thinking that they couldn't be outsourced are finding themselves losing jobs either through "insourcing" or through clients cutting back.
I think some of us might be from different generations.

When I was choosing a career path (between high school and college) outsourcing wasn't even a coined term you heard. It wasn't happening.

Now, of course, and for the past 10 years or so, outsourcing is talked about and discussed by the pundits, the economists, and in the news.
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#89 of 147 Old 01-27-2009, 12:29 AM
 
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I think you make a lot of valid points. I think choice certainly does play a large role.

I hear these examples a lot, especially in this forum, of the role choice played in finances - accumulating debt, carrying credit card debt, and not being able to differentiate well between wants and needs.

I guess I'm always a bit stunned...like, is this real? Is it an accurate picture?

For instance, with the student loan example, I went to an affordable school (but still a pretty well rated one) AND I had a pretty decent amount of scholarships. It wasn't a private college but I still ended up with significant student loan debt because I paid for 100% of everything myself. I've just about paid all that student loan debt off, and it's taken me years of being dilligent about it.

I was pretty selective about what major I chose, with an eye for career use and being able to support myself, but also making a good contribution to the world. I just know that without the degree, I would not be in good financial shape so that student loan debt was a blessing in every way! It did delay when I had children, for sure, and it was a small factor in whether I could stay at home or not, but mostly it was other economic forces that determined that one for me.

For what it's worth, I've always been frugal and lived within my/our means. I save and have a retirement nest egg. No vacations, luxury things, etc. Never had an ounce of credit card debt.

It's really the cost of living, and the stability that also comes with having an income and career of my own that I can rely on, that makes it impossible for us to live permanently on one income.

Cost of living is the number one factor, though.

I was lucky enough and frugal enough to be able to save up a bit and be a stay at home parent in the early years, and that is a blessing. I plan to return to work sooner rather than later, though. The ability for us to live on one income in a permanent arrangement is simply out of the question.

And we're two college educated, good income, frugal, wise money managers. It really comes down to cost of living in the area you live for a lot of people.
This is SOOO true. To be honest, I get tired of this debate. Because for 90% of the people I know, it is not possible to raise a family on one income. Period. Wages are not adequate for cost of living.

My DH and I are both college educated. We went to state schools, paid our way through college. We had NO debt when we got married and had a simple wedding that I paid for with my savings. We've never had a fancy honeymoon or vacation abroad. We never had any CC debt. We live ridiculously frugal and are consider misers by everyone who knows us. Even with all these "right" decisions and careful money management, we could never live on one income in our area. Housing and utilities alone make up 50% of our income (and we own an old, tiny 1100 square foot house - but renting isn't any better in my area)!

From what I can tell, the ability to raise a family on one income went the way of the dodo for most American families in the 1970's when inflation hit the first time. Since then, wages have never really recovered. Some families may afford a SAHP simply because they live in a low cost of living area and/or one spouse is a professional who makes 6-figures. Now there may be a % of the population who is spending wildly beyond there means to "keep up with the Jone's"; sure this happens, but you can't assume that every family with two working spouses is spending above their means. Most families are just trying to cope with raising healthcare, living, and childcare expenses. I guess what I am try to say is that the idea that everyone can be a SAHP if they only choose to is a myth, in my personal experience.

Sorry, but this topic rubs me the wrong way. I'm tired of working hard my whole life (since I was 14) just to eek out a modest living, and then being judged by people who can't understand that not everyone has a choice.
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#90 of 147 Old 01-27-2009, 12:32 AM
 
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Oh, I totally hear you!

Trust me, there are many days where I wonder what am I doing this for? This is too much work and stress for this amount of money!!

But, for me, that $175 week is needed for our budget, and helpful, even if it's not that much money. Actually, I net less than that after child care, etc expenses.

But I won't be paying child care forever, and, in the mean time, I'm gaining more job experience and hopefully will get salary increases eventually from that. So, by the time my child is in school, I hope to make an even better salary.

And retirement is a big part of the reason I keep at it. Also, benefits. I get great benefits and they come in handy. And given some of the dynamics of my marriage, I really need my own income and job history to rely on.

And, really, DH just does not and never has and never will support me being a SAHP. It used to bug the heck out of me, but as our child gets a bit older, it's not as big of a deal (I suppose anyway...I still struggle a bit with the sadness and the disappointment and the guilt). I used to try to figure out how to make it happen, but then I just decided I tried long enough, and without DH's support, it wasn't even healthy to try anymore.

Mostly, though, I think the retirement issue is a bigger deal for older parents. I delayed having kids. I don't have that many more years ahead of me to save for retirement, and with this economy, our retirement is way down (like everybody's).

If I had had children younger, perhaps I could think about saving years down the road. In some ways, there are good reasons to have kids younger, and some good reasons to have at an older, more established age. Pros and cons. Such is life!
Nice, I hope you don't think I was saying it didn't make sense for you to work. I was thinking about my current situation, and it just wouldn't add up to being helpful, financially. You have a good point about daycare just being a temporary expense. Except with me, cause I want more babies and I could see always having to account for it, at least before and after school care.

Honestly, from what you've said on this thread and several others, I'd work if I was you... even if the money truly wasn't needed. I do think you are very wise with figuring out how it benefits you and your family, and re-acessing it periodically.

Also, your statement in another post about wohm making less than 30K, makes a lot of sense to me, too.

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