Third Child / Daycare

[gumbo]

Although I can't say I agree with much of your reasons for not wanting a third child, particularly the one on finances, I do see that you are a reasonable guy who looks at all angles. We need more children raised by men like you, so please go for it.
Also, your wife is the most important person in your life, so make her happy!

 

[Jarick]

I get that you can’t put a price on children…but they have a cost. Not their worth, the cost. You still have to pay it.


I’m going to make up some numbers to illustrate the point. Let’s say you are a dual income family making a combined $100k per year.


Income = $8333/mo


But that’s not your actual income. You have taxes (35% = $2916), medical/dental for a family ($300/mo), and child support ($150/mo).


Net Income = $4966/mo


Now you have debt. You have a mortgage with property taxes, PMI, and HOI ($1250), a car payment ($200), and student loans ($200).


Debt = $1650/mo
Net Income = $3316/mo


Now you have bills. Non-negotiables. Gasoline ($150), cell phones for two people…let’s say you do prepaid cheap plans ($50), cut the cord and go internet only ($50), insurance for the cars ($150), electricity ($200 average), trash ($25), and water ($25).


Bills = $650
Net Income = $2666/mo


Next is expenses. These are things you will have to spend money on at some point. You have auto expenses including oil, wipers, tires, and bulbs and this doesn’t even include repairs ($25), Christmas gifts that you responsibly set money aside for your entire family each month ($25), another fund for birthdays and misc gifts throughout the year - you do still have to get grandma at least a card on her birthday - ($25), haircuts for the entire family ($25), groceries are the big item ($400), money for clothes and activities and everything else for two older kids - and this is lowballing big time ($60), and then baby expenses including disposable diapers for daycare (cloth at home), clothes, creams, etc ($40), dog food ($20), and things for around the house not including needed repairs ($25).


Expenses = $620/mo
Net Income = $2046/mo


Lastly you have discretionary spending. Clothes and shoes for the adults, mostly this is for the wife ($50), cash for pocket money ($40), the inevitable fast food that happens a few times per month ($40), entertainment like books, music, movies, etc ($25), liquor because you do want to have a few pops on the weekend ($30), family or date night activities and let’s be honest it’s not going to date night because that won’t happen on this budget ($25), and other miscellaneous discretionary spending for two adults which would go towards things like shaving but not on this budget ($50).


Discretionary = $260/mo
Net Income = $1786/mo


Hey you have nearly $2k per month! Oh…we forgot day care. That’s $2500 per month. So that’s a shortfall of $713/mo. Oh, we also forgot the medical bills associated with the delivery, which is $200 per month (I wish that were the case). No, it’s not tax deductible because you already ran in through your HSA and it’s under the 10% of income threshold. Now a shortfall of $913/mo. But there is a tax credit for daycare which maxes out at I think $3500, so let’s call it a $300 per month positive. Now we have a shortfall of $613/mo.


That’s the reality. Going as low as possible in every area and still coming up half a grand short per month.

 

[soccerguy83]

+1 and I'm only looking at having the first in Aug! The wife wants two and I just don't know if that's a reality.

 

[jamesspo]

That’s the reality. Going as low as possible in every area and still coming up half a grand short per month.

You've pretty much spelled it out, I say. It's not doable if your income in anywhere close to that. The numbers you pulled together are *very* optimistic, particularly on food. I don't have any kids, so of course I can't speak to the value side of the equation (and I'm sure that's huge). But I'm a big advocate of having more than enough in the account every month. With the kind of situation you've spelled out, you're in the hole. If you could somehow make it work, you'd be a pay check away from the street all the time. That's no way to live, and puts your family at significant risk.

 

[thematthatter]

in my opinion, when you already have a child who is 6months old, that is way too soon to plan for another baby.
We almost have a 4yr old and my wife has one on the way. My wife wanted one a little closer together but I have been gone for about 22 months out of the last 4 yrs due to work, but most of that time together we used some sort of protection as I didn't want to have two kids in diapers at the same time.

 

[Steve in Shalimar]

For what it's worth, I have no kids but was able to completely retire at the age of 54. My Optometry school classmates are all still working away like hamsters in a hamster wheel. Now, I just go on cruises. Not all of us are cut out to be parents. Don't forget, each kid is a quarter of a million dollars! I have Long Term Care insurance to take care of me if I need it and no regrets.

 

[GlennConti]

For what it's worth, I have no kids but was able to completely retire at the age of 54. My Optometry school classmates are all still working away like hamsters in a hamster wheel. Now, I just go on cruises. Not all of us are cut out to be parents. Don't forget, each kid is a quarter of a million dollars! I have Long Term Care insurance to take care of me if I need it and no regrets.

Quarter of a million!! At least!! A private undergraduate college education is $200,000 alone. If your kids go to prep school for high school and graduate school the bill is enormous. My kid's prep school was $14,000 per year each. If you have smart kids, you don't want to stunt their growth. You need to provide them with every opportunity you can afford.

 

[TigerFan]

This is a great thread because it seems to offer just about every perspective, and in a respectful way! I'll throw in my 2 cents as well, not just for OP, but for everyone else that stumbles upon this.

I've got 2 and a third planned before long. My kids are boys, almost 4 and 15 months. My wife and I both feel that we were meant to be parents. It's what Christians like to call a "calling" at least for me. I am the third child in my family. My parents had a boy and a girl two years apart. Many folks would be happy with that, but thank God my folks weren't. That has always sat strongly with me. (To offer a little bit of their perspective, I'm the only one who stayed in the same city. I'm the only one with grandkids they can see whether they want. When I was in high school my dad's job involved a lot of time away, something both of my parents hated. I know my mom cherished having me at home. We cooked together, watched television together and ate meals together. That meant A LOT to her at the time.)

I never wanted to stop at 2, but obviously there are a lot of factors at play. I can say that my wife was unwilling to talk baby #3 for about a year after #2 came along. I think your hesitation is completely in understandable, but you need to understand where your wife is coming from too. Definitely hold off a bit and have that conversation when you're ready.

The financial side for us? We've been lucky. I was unemployed when #1 came along and have worked from home here or there but mostly been a SAHD. I wouldn't say I love it, but I love that my kids have benefited from it. It has made married life easier because we aren't trying to squeeze EVERYTHING in on the margins (laundry, yard work, family time, etc.) My wife has a good job and good income that is serving us well. Like I said, we're lucky.

 

[SpikedLemon]

I've two now and having that conversation with the missus on a third - though I'm the one considering it (funny that I was the one that only wanted one kid). The littlest one is 9 months now and both kids have been great. We're very lucky that my mother-in-law is retired and minds the kids for us (costs us a fraction of daycare).

Though, outside looking in, medical expenses & lack of maternal leave in the USA: I couldn't imagine it. It's expensive and difficult enough.

Famous words: a happy wife is a happy life. But having one who understands finances will definitely be beneficial when things are tight.