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Staying Home with Baby

How We Planned Financially for a Year at Home

Staying home with baby for the first year takes some financial planning. It was easy but at the same time not. And now that we are getting ready for our second baby I am starting to re-evaluate how we are going to be able to do it again. So far we have managed for me to be home for the last two years (second year was COVID so yea… a special circumstance for sure). It has been amazing but how we are going to stretch it out for another year has me a little puzzled. So while we are thinking through that I will share how I was able to stay home with our little one for the first year. I hope you find some tips and insights that can help you.

Set Your Goals

Think about your goals. Do you want to stay home for a year? Six months? 2 months? It is hard to know what you really want in a completely new situation like your first baby. You have no idea what it is going to be like, how you are going to feel, or what the future will hold.

I have talked to girlfriends who said they would be ready to get back to work right after maternity leave only to dream about being back at home after two weeks of being back on the job. I mention this because it is difficult to know exactly what will be right for you but keep an open mind when exploring your options.

Shoots, getting back to work could be exactly what you need. It is a very difficult question to ask yourself but ask yourself when you are ready so you can start planning. I started this process when I was about 20 – 24 weeks pregnant which oddly is about the same time I am thinking about it this second time around.

My Personal Staying at Home with Baby Goals

I had two goals; a short and long term goal. Short term was to stay home with baby for at least 6 months. Long term was to stay home with baby for a year.

Knowing my long term goal I planned for that so I had cushion if I returned to work at 6 months but knew that if I wasn’t ready I had a year.

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Take Stock of Where are You at Right Now

First thing to ask yourself is, “Where am I at right now?” Everyone’s situation is different and unique so this question will be very personal. But for the sake of this post and the thought process I went through I will share where we were.


My husband and I both worked full time office jobs. His job was a very stable employee position that supplied our medical insurance. My job was contract work completed under my S Corporation; the work could fluctuate from extremely busy to non existent within a quarter or two.


We bought a 2 bedroom 2 bathroom house 6 years prior to having our daughter. At the time we had stretched our purchasing power as far as we could and over the years we were able to afford the mortgage more comfortably. We knew we could make our space work for the three of us for a while. But could we go down to a single income and still afford the roof over our heads was the next question.


In order to understand if staying home with baby on a single income was feasible we had to look at our debt and expenses. My husband has always been a saver and frugal with his money; so he’s never had outstanding debt (besides the house!). Me on the other hand… keeping money in the bank is always a struggle.

Four years prior to even thinking about kids I made a resolution to not have any more outstanding credit card debt and worked diligently to get that under control. Once that was taken care of I focused on paying off my student loans. All student loan debt was paid off two years prior to having our daughter. I was feeling good about our debt situation until I realized that I had a hefty car payment and business expenses since I wanted to keep my S Corporation operating. I would need to make a plan in order to keep those two items and my goal of staying home with baby.


After figuring out the recurring debt we would encounter we turned to our expenses. Man this was an eye opener! Over the years our pleasures became sushi, wine and whisky, spontaneous splurges on dining experiences and not questioning whether we could afford a gadget or some other nice gift for ourselves or others. We never went on extravagant excursions or vacations so we didn’t have to cope with that change in our lifestyle. It wasn’t until we busted out our bank statements from the prior year that we realized all this extra spending was happening and where our money was going. We easily decided that all the extras had to stop immediately so we could start saving right at that moment before the baby came.

Examples of Extra Expenses

  1. We had a Hero Loan which helped us redo our kitchen, upgrade our windows and front door which was much needed (everything in our house was original from 1970!) but we knew we couldn’t make that loan payment on one income. We reached out to our Mortgage Broker and worked with him on a refinance consolidation loan which got rid of the separate Hero Loan payment and saved us an additional $400 per month on the mortgage payment. Yes, we started over on our repayment schedule but savings like that in exchange for me staying home with baby made the most sense to us.
  2. Our cable and internet bill was out of control. We called to remove services we never used to help get the bill down.
  3. Dining out whether it was fast food or a fancy sit down dinner was costing us big time. We noticed that fast food was costing us two almost $30.00 for dinner. That is insane when you think that $30.00 in groceries can feed you breakfast, lunch and dinner for 3 days! We started cooking at home a lot more.
  4. As for the gadgets and other nice gifts, we questioned whether it was really needed or if there was a cheaper alternative that would be just as good. Remember, cheaper isn’t always better if it has to be replaced or breaks easily, etc…. Also keep in mind things are just things; a couple years before we had our daughter our families decided against doing Christmas gifts for the adults which ended up saving all of us a lot of money.
  5. We had three wine memberships. The two most expensive ones we either canceled or paused shipments. The third one we kept as it was inexpensive and only delivered quarterly. Gotta have something for ourselves!

There are More Ways to Save

  1. My husband loved buying the latest movies on AppleTV and downloading music. We stopped making these purchases and used Netflix and Amazon Prime (memberships we already had) for our movies. And he got a Pandora subscription instead of buying music.
  2. I had a fitness membership that I never used. We have a home gym and I was just too freaking lazy to go to the gym to cancel the membership. If you are in a similar situation with any membership march down there and canceled that thing quick.
  3. I also had a massage membership which I used throughout the pregnancy but canceled right before my due date. I miss that extra something I did for myself but you find other ways to carve out “me time”; mediation, going for a walk, yoga, etc….
  4. Don’t forget to include the savings you will gain when you stop working. For example, you won’t have to pay for gas, wear and tear on your car, monthly parking fees, and you will most likely get a refund on your auto insurance because you aren’t driving as much (we did!). Your expenses for work clothes will go down (or be non-existent); I haven’t bought work clothes in over two years and I never go to the dry cleaners anymore. You won’t be eating out for lunch, grabbing a cup of coffee or snack, or going out to happy hour. While you may miss the casual interactions with your co-workers you are saving a ton of money and getting a ton of snuggly giggles staying home with baby.
  5. Get rid of your ego and allow people to help you. This one is hard but people who love you want to help and be there for you. So when they offer to buy your lunch or drink let them and don’t feel bad if you can’t reciprocate. You can make that gesture when you are able and remember they love you so it doesn’t matter! They are not keeping tabs, promise!

Let’s Add It All Up

After reviewing our expenses over the prior year we added up everything we needed that didn’t fluctuate that much.

Non-Fluctuating Expenses

  1. Home Mortgage
  2. Home Insurance
  3. Property Taxes
  4. Car Insurance
  5. Car Payment
  6. Gas
  7. S Corporation Operational Expenses
  8. Life Insurance
  9. Memberships (Netflix, Amazon Prime, Wine Membership, Pandora, Costco)
  10. Savings (Retirement, Personal Savings, etc…)
  11. Taxes

From there we reviewed all other monthly fluctuating items to see if we could squeeze them from one income. I call these fluctuating expenses because if it doesn’t work in the budget for the month we can spend less money. Or if for some reason we have a bit more in the bank we can grab that extra something or other we had our eye on. Changing our mindset from instant gratification to being grateful for what we have has been huge in being able to live off one income.

Fluctuating Monthly Expenses

  1. Groceries
  2. Utilities
  3. Prescriptions (quarterly expense)
  4. S Corporation creative expenses (crafts, food, Adobe Creative Cloud, equipment, etc…)
  5. Fun Money (dining out, day outings, etc…)
  6. Birthdays and Holidays
  7. Car Maintenance (oil change, windshield wipers, etc…)
  8. Doctors Visits (dentist, general practice, pediatrician, dermatologist, etc…)
  9. Home Repairs

How to Plan for Fluctuating Monthly Expenses

It is difficult to plan for things that fluctuate from month to month or that don’t happen but once or twice a year. We took a look at averages for things we buy every month; groceries and utilities. And planned those as a fixed expense knowing that depending on the grocery list or the weather the actual cost would fluctuate.

The rest of the items listed above occur as they happen and we try our best to plan. Keep in mind you can create your budget for things like creative expenses, fun money, birthdays, and holidays. If we didn’t have the budget for those items then we went without them until we could afford it. Things like car maintenance, doctor’s visits and home repairs just happen and we have to roll with the punches. Having an emergency savings account should help with things like that but if it is out of your control and has to be taken care of there is credit; just remember to make it a priority to pay off.

Is There a Credit or Deficit?

After adding everything up we knew we had a deficit. One income wasn’t going to cover my car payment and business expenses. With a conscious effort to reduce unnecessary expenses we could budget within one income for the rest of life’s necessities.

Other Ways We Reduced Spending

We had to find ways to further reduce the amount of money we were spending and we did the following which helped.

Remember your goal: Staying home with baby!

  1. Groceries- We ate a lot of meat products, some prepared foods, and all organic.
    • Instead of buying our meat products at the local grocer we opted to stock up at a warehouse facility, i.e. Costco. We also reduced the amount of meat products we consumed and opted to eat plant based; which is cheaper and better for us.
    • The prepared foods like already made pizza dough, cookie dough, chips, etc… pretty much all snacks got the boot. We opted to make a lot of these things from scratch or just not eat them period. They weren’t serving our health or our bank account so they had to go.
    • Eating organic is a non-negotiable for us so it stayed. Organic is expensive but you can find seasonal, organic food at a farmer’s market or your local grocer which is usually cheaper than a chain or specialty grocer. You can also choose to eat less of it. For example, organic chicken at Costco costs almost twice as much as non-organic. While you don’t get as much food purchasing organic you spend approximately the same amount but are able to eat more consciously and can supplement the rest of your meal with fruits, veggies, beans, rice, etc… items that are organic, cheaper, and good for you.

Think Outside the Box

  1. Consolidate- Do you have a night cream, eye cream, face serum, face lotion, face sunscreen, etc…? Do you have a cleaner specifically for the windows, counter tops, furniture surfaces, floors, toilets, kitchen appliances, etc…? Think about consolidating!
    • Seriously after you are done with the products you already have replace it with something that does multiple jobs. Or don’t replace it if you don’t really need it. I got rid of my night cream, face serum, eye cream and face lotion. All I use now is a overall body lotion and sunscreen. As for all the cleaning products; I use Dr. Bronner’s all purpose cleaner for everything- windows, counter tops, appliances, floors, bathtub, etc… I did keep a separate cleaner for specialty items like our wood floors and toilet bowls. But the point is you DO NOT need a separate cleaner for each item in your home.
    • Take stock of the things you use and see if there is something out there that can pull double or triple duty. Here’s another example: Our daughter needed new shoes for the winter, something that would keep her feet dry and warm. We found a pair of hiking boots that are waterproof and super warm. She did not need three different pairs of shoes (hiking boots, rain boots and winter boots) just one that did all three!

If You Own a Business or Are an Independent Contractor

  1. Business Expenses- My business is very small, like just me small. My business was not going to operate the same way with me not working so I took a look at the items I no longer needed. I use Quickbooks and ran payroll and quarterly taxes through it. With me not working I would no longer need payroll so I removed that service. I also knew what quarterly tax forms needed to be completed so I removed that function as well. I had an accountant but with business slowing down to nothing I decided to no longer use their monthly services and opted to use them to complete annual taxes only.

With all that Said; It is Time to Save

At this point my husband and I felt pretty good about scaling back. But scaling back our spending didn’t mean that all our expenses were covered for my goal of staying home with baby for a year. The items that wouldn’t fit in our new one income budget were my car payment and business expenses (license, Quickbooks, State and Federal fees, Adobe membership, etc…). I was 20 weeks pregnant when we did this income – expense review and had 4 – 5 months to work and save money.

If You Own a Business or Are an Independent Contractor

Staying Home with Baby: Another Option to Consider

Saving for retirement is very important; I can’t stress that enough. But what also helped us get more cash in our hands when we needed it was to reduce the amount we were contributing to our retirement accounts. If this is an option you are considering, see if it works in your budget to still be contributing something. Something is better than nothing when saving for retirement; it will grow to take care of you in the future.

Staying Home with Baby: Recap

Let’s recap the steps we took so I could stay home with baby.

  1. Set Your Goals
    • Have an honest conversation with yourself about what you would like. Stay home for a year, 6 months, 2 months, longer, shorter?
    • The sooner you start this thought process the more time you have to save.
  2. Take Stock of Where are You at Right Now
    • Every person’s situation is different.
    • Review:
      • Work or source of income- We all need a source of income, where will yours come from?
      • Residence- Review your living situation. Can you still live in your current residence with a reduced income?
      • Debt- How much debt are you in? Can you relieve any or all of the debt? Can you afford to carry over any debt with a reduced income?
      • Expenses- Pull all your bank statements over the last year and comb through them. Are there any expenses you can get rid of? Any expenses you can reduce? Remember there will be money you save while not working as well. Make a plan to reduce what you can and stick to it.
  3. Let’s Add It All Up
    • Once you understand what debt and expenses you have add it all up for a monthly budget.
  4. Is There a Credit or Deficit?
    • Re-evaluate your expenses. Can you reduce them further? Get creative! Buy bulk. Take stock of the things you use and see if there is something out there that can pull double or triple duty. Make things yourself. Question whether something is really a necessity, can you make due without it, is there a cheaper alternative.
  5. With all that Said; It is Time to Save
    • Start living like you are on one income.
    • Save everything you can until you go on leave.
    • Submit for state disability paid family leave.
    • Consider other ways to help you save or stretch the time you have with your money.
  6. Staying Home with Baby: Another Option to Consider
    • Are there any other opportunities to get more cash in your pocket?
    • We reduced our contribution amount to our retirement accounts. This isn’t an option for everyone but we did this and it helped us get to our goal.

Remember your goal: Staying home with baby!

I’ve Been Home for Two Years Now

Doing this financial evaluation and sticking to it helped us reach our goal. I wouldn’t have been able to stay home with our daughter without the help of my significant other. We pushed each other to save even more once she came. Everything little thing we did like canceling a $29.00 gym membership, completing a refinance consolidation loan on our home, paying more in taxes to get the money back later, gratefully accepting hand-me-down clothes set us up to get through probably the toughest year any of us have seen, 2020.

I thought I was going back to work in 2020 but the universe had other plans. Staying home for two years wasn’t the original plan nor being a permanent stay at home mom but things change and happen for a reason. Now we are re-evaluating how I can stay home even longer, maybe permanently, since we have another baby on the way. We’ll let you know how it goes. I do have this blog so… in a sense I am working… for the long game. 😉

I hope you were able to gain some insight and make plans to help you stay home for as long as you like with your little one. The days will feel as though they go by slow but the years go by really fast. Enjoy all the snuggles!

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