The Sunday Mail
The simple act of going to work — waking up, getting dressed, jumping in your car, dropping the kids off, grabbing a coffee, running errands on your lunch break — takes a huge bite out of your pay-cheque. In this article, we will look at some of the direct and indirect costs of holding down a job.
Once you know how much you spend on working, you will have a better idea of your “real” take-home pay. This will help you figure out the financial implications of staying at home with your child vs. staying in the workforce. (There are non-financial considerations as well, such as job satisfaction and socialisation. This article’s intent is to only focus on the financial aspects of that decision.)
What Are the Direct Costs?
When you go to work, you’ll definitely need to pay for:
Fuel / Transportation
Work-related clothing (suits, shoes)
Daycare
Coffee
Lunch
Even if you brew coffee at home and pack your own lunch, chances are that you will buy coffee or grab food at least one day a week, or once every-other-week.
Depending on the type of job you have, you might also pay for:
Dry cleaning
Maintaining a nice-looking vehicle
Car washes
Not all professions will incur these costs. If you sit at a computer all day and do not interact with clients often, you probably will not feel pressure to have a well-groomed appearance and a nice-looking car. But if you are in sales, you might feel like some of the items on that list are expected.
What Are Indirect Costs?
In addition, you will be more crunched for time when you are balancing work and home. There is a chance you will pay more for:
Ordering take-away or delivery food at home
Buying more pre-chopped, frozen or pre-packaged foods
Refraining from comparison-shopping or coupon-clipping as often
Buying from stores that are the most convenient, rather than the cheapest
Add up the cost of all of these items. Childcare, of course, will be the biggest expense on the list, but the other items can add up to more than you think. Buying a $6 lunch once a week adds up to $300 per year. Buying a $3 coffee once per week tacks an extra $150 to the total.
Once you calculate the cost of working, you will be able to make a more informed decision about whether it is worth your time — financially speaking — to be a working parent or to stay-at-home.
If the “cost of working” totals $20 000 per year, and you bring home $25 000 after taxes, then it might not be worthwhile to work. Your “real take-home” is only $5 000, which comes to about $2,50 per hour if you work full-time (2 000 hours per year).
On the other hand, if you are determined to be a working parent, discovering your “real take-home” can be the motivation you need to ask for that raise or apply for those higher-paying positions. — Wires.
