# Can I afford to give up work to mind kids?



## L&A (15 Jul 2008)

I have been doing alot of research into whether or not I can afford to give up work. Long story short but my job isn't working out too well to say the least. Ideally I know it would be best to get a p/t job, but they are proving difficult to find in my area. Firstly I want to know if there is any income I have missed (or hopefully not expenditure I have missed), plus any suggestions on ways to make my money work better - I think I've researched most of the options but someone might see something I'm missing. Do you think we can survive on 1 salary?
Here are our details
Husband on 57.5K
Me on 41k
Joint Monthly Expenses:
*Debits*Mortgage protection 57.65, Childminding 836, ESB 56, Credit Card 250, Grocery 800, Gas 90, 
Home Ins 41, Pension 463, mortgage 1319, Mortgage/ESB/gas Contingency 100, Milk 50, Bins 35, Pet Ins. 20,
*Total**4117.65*
plus landline and basic NTL (paid by DH from his account not sure how much)
plus I also spend 1100 approx on misc stuff including €256/month on car loan, 36 on car tax, 38 on car ins., 150 on petrol.
I reckon if I gave up work I would save in the following areas:
saving/mth
GP (if get a GP card)60
sell 2nd car: Loan, tax etc 400
Loose Cleaner: 100 
Transfer of Tax credits 200

Childminding 636

we also get ECB of 500 per quarter, 332 chilcare allowance, rent of 500 from renting a room. I think there is also a home careers tax credit of 900/yr and I may be entitled to tax back at end of yr as have had 4 mths unpaid mat leave. I was thinking of selling my car (worth 19K to an older one which is cheaper on tax too, 5k owing on loan)We would sell 2nd car, worth 4k but that pays off loan only. Need landline as reception in house not good enough for mobiles.
Our mortgage is a tracker variable with a good rate (reviewed recently) as our LTV <50%, mortgage is for 30yr with 25 remaining, around 270K owing.
I only plan to take 1 yr max off. 
We have no other loans, credit card is paid off in full monthly. No bank charges etc. €300 savings in total.
I've done a fair bit of sums, but if you can help I'd appreciate it!
Many thanks


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## irishlinks (15 Jul 2008)

If your husband is gone all day with the car you might be tied to the house all day without the second car  - unless you have good public transport.
(Might help cut down on the Misc spending though?)


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## L&A (16 Jul 2008)

No, I'd have the car.....at the moment DH drives to the train station after dropping the kids to creche, with me not working, kids don't need to be dropped to creche and its only a 15 min walk to station.  At moment he is paying for a car and public transport as only use car to drop off kids!!!  Definetly a saving I think!  My car is too big now too as I don't need a double buggy etc anymore at mo I have a zafira, but I think a saloon model would be fine!


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## bamboozle (16 Jul 2008)

home insurance of 41pm equates to nearly 500 per year!!!! give FBD a buzz to see what they'd do it for, i've a few properties around dublin and am paying no more than 370, 

a 15 minute walk is a 3 or 4 minute cycle so why not bike it to train and save on 2nd car and its petrol insurance tax etc


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## L&A (16 Jul 2008)

Yes thats why we are selling that car- DH can easily walk it (that's our 2nd car).  Re. the house ins. I've tried getting cheaper quotes but never seem to get them....123.ie matched our quote last year but they where loosing some of the policy benefits.  I think the quote is based on the re-build costs, its a fairly big house in Dublin, worth >1M, I think we est. it would cost about 300K to re-build.  (we built it ourselves 5 yr ago and we've added a bit for inflation etc, so I think that figure is fairly accurate?)


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## L&A (16 Jul 2008)

Do you think looking at our figues it would be ok to give up work for 1 yr?


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## niceoneted (16 Jul 2008)

What is your husbands net take home pay?


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## irishlinks (16 Jul 2008)

The savings you mention (car, cleaner, childminder, tax credits) come to 1411 a month (I have assumed zero childminding costs - not 200)
Your net pay is probably around 2300 or so - so you are short by about 900 a month.
But - you have Misc. spending of about 850 (including 250 cred card ) you need to get a handle on what that is spent on and try to reduce it. 

The amount for the pension seems very high to me - 463 a month? Can that be reduced or was it a typing mistake?
Also your mortgage protection sounds high - maybe shop around for a lower rate?


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## L&A (16 Jul 2008)

irishlinks said:


> The savings you mention (car, cleaner, childminder, tax credits) come to 1411 a month (I have assumed zero childminding costs - not 200) would be 200 for community childcare. *Older child would need something during the day to get him out of house.*
> Your net pay is probably around 2300 or so - so you are short by about 900 a month. *My net pay is around 2600, yikes!*
> But - you have Misc. spending of about 850 (including 250 cred card ) you need to get a handle on what that is spent on and try to reduce it. *Yes, I agree some of this can be reduced but I want to have a contingency for unexpected expenses, but maybe this is not possible!*
> 
> ...


 
*DH annual salary is 57.5K,*

*Thanks for all your help*


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## michaelm (16 Jul 2008)

L&A said:


> Do you think we can survive on 1 salary?


Yes.  My numbers are not too dissimilar to yours, although I've more kids than you.  We have been surviving on one salary for six years now.  We're very happy we went down that road, making what adjustments were necessary to make it fit, as it has improved quality of life for the whole family.  Certainly lose the second car and the cleaner, put the squeeze on all other expenses.


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## L&A (16 Jul 2008)

oh, thats great to hear  that's made my day.  And you've been managing for 6 years??  (wait til I tell DH that!).  Even if we could manage for a year and then re-assess, I would be happy with that.  Kids are only 1 & 3 so I would love to spend more time with them.


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## Lsquared (16 Jul 2008)

Its been a while since my own children were as young as yours so I'm having a hard time visualising your monthly grocery bill but it seems to me that savings can be made there. My family eats a lot and we have several animals and our weekly grocery bill is usually around 120 - 130. See if you can bring down that cost. Dont know if you have any of the diiscount supermarkets nearby but we have saved a lot by doing the bulk of our purchases in Lidl. You are only looking at a year and children grow up so quickly -I hope you find that your family can manage on one salary and enjoy the time with your young children.


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## L&A (17 Jul 2008)

Thanks, yes I was probably being a bit generous in that estimate for groceries: sometimes it is more, sometimes less.  If I give up work I'll definetly have more time to shop in LIDL as well- I find they are only good for basics and you end up shopping elsewhere as well- at the moment I hardly have time to shop once a week let alone anything else, but if I give up work then, yes, I'd say you are right I can make a saving there. There is a LIDL close enough too!


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## SarahMc (19 Jul 2008)

You'll also have time to cook/bake from scratch, make lunches etc. saving a considerable amount.

I don't understand, do you have one child or 2?  €836 is very cheap childcare for 2, or have you not factored in the childcare for the baby?


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## Vanilla (20 Jul 2008)

If it is really only for a year you could also consider going on an interest free mortgage for the year to give you that extra cushion per month. Then try your best to actually save the 'capital' per month maybe in a high interest savings account. At the end of the year if it works out you won't have lost out. But even if you do IMO it's worth it to spend that time with your children- something you will never regret.

Something to consider too is the possibility of part-time work?


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## Raskolnikov (20 Jul 2008)

Your home insurance and mortgage protection insurance seem quite high. You should shop around for a better deal, the fact you're looking for both should get you a discount.


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## L&A (21 Jul 2008)

My childcare is for 2 but its a bit a complicated:my mum currently minds them 2 days- we pay her 225/mth, I only work 4 days and DH takes a day off during the wk to mind them too.  My older son is in Montessori 5 morns per week. The other day they are in creche 1 full day, creche currently cost 611/mth for montessori and 2 for 1 full day.  If I give up, I will have older son 3 hrs/day in a community creche which is subsidised- I feel it is important at 3yo to be socialising with kids his own age, rather than being at home all day with baby.  Obviously, I wouldn't be having anyone mind baby if I give up work.
I was thinking about the interest only mortgage but don't want to extend the mortagage or increase the repayments....but you I'm interested to hear more about your idea of saving the diff. in a savings a/c and paying off at the end of year if we can afford.  Assuming we could do that (but it would be great to have the cushion if needed) and we paid off the full amount that we would have been paying in at the end of the year, would we be in the same situation financially as if we just continued to pay the mortgage?  Or are there fees for the bank doing this....or will the be any extra interest payable on the amt we didn't pay in straight away?  Really interested to hear more about this option....
Re. home ins. and mortgage prot.- I think it is based on value of house and my health issues (see previous reply on this).  I can't seem to even find any insurers to give me quotes as I'm diabetic, there seems to be only one insurer!!!  ...but is this legal, surely there should be some choice?  Am I correct in assuming the home ins. quote is expensive because of the rebuild value?
Thanks


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## SarahMc (21 Jul 2008)

Would your employer be open to you using parental leave to give up work for a while, or reduce your days down to 2?

I presume your partner will go back to 5 days when you are at home with children, have you factored that increase in household income into your sums?


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## Vanilla (21 Jul 2008)

L&A said:


> I was thinking about the interest only mortgage but don't want to extend the mortagage or increase the repayments....but you I'm interested to hear more about your idea of saving the diff. in a savings a/c and paying off at the end of year if we can afford. Assuming we could do that (but it would be great to have the cushion if needed) and we paid off the full amount that we would have been paying in at the end of the year, would we be in the same situation financially as if we just continued to pay the mortgage? Or are there fees for the bank doing this....or will the be any extra interest payable on the amt we didn't pay in straight away?


 

Maybe use one of the mortgage calculators to work out what the interest payments would be per year?

Obviously on the savings account you will be paying in X amount per month on which you will earn interest ( but that interest is taxable).

I'm not an accountant so number crunching isn't my forte- maybe someone else can help you out there.


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## L&A (21 Jul 2008)

Apologies, I didn't make it clear- my husband works 5 days already- he just takes 1 day off during week and works Sat instead. We only have 1 day (Sun) where we are all off together to reduce childcare bills and the kids benefit from spending more time with their parents, though the parents only have 1 day together!
My employer only does parental leave in blocks and they are not willing to reduce my hours further.  Long story, but 4 days is even a problem to them.
Re. tax on saving a/c- would I have to pay any if I wasn't working?
Anyone know of a mortgage calculator site where I could work out the interest-only payment.

All in all do people think we would be ok if I give up work and changing the mortgage to interest-only etc are nice to have in reserve if need be, but would be ok anyway......or do we need to make some definete savings before I proceed?  I had a couple of answers of yes- that we should be ok....is that the general opinion?  (keeping my fingers crossed)


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## tommyphelan (27 Jul 2008)

hi L&A , here is a link to a mortgage calculator which gives interest only amounts :


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## L&A (29 Jul 2008)

Thanks TommyPhelan, I had a look at that- it is quite useful, interest only is something I think I will keep in reserve and only use if we need to for the minimum amt of time though, will try to get some part-time work too.  My browser didn't support the Karl Jeacles one, but this one was fine, thanks!
Have decided to go for it and give up work!!


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## L&A (27 Aug 2008)

Can't seem to sell one of the cars....bad time I know...but any suggestions as to what to do now.  Finishing next week and ideally wanted to have sold the car and cleared the loan but that doens't seem to be happening.  Loan repayments are €250/mth plus tax is due in Oct.
I've advertised in Autotrader and some of the other free car selling web-sites.  Thought some would want to buy it though- its reasonably priced compared to other similar cars on the market.  No calls at all (€6000 for 2003 Citroen C3 with low mileage)


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## Diziet (27 Aug 2008)

L&A said:


> Can't seem to sell one of the cars....bad time I know...but any suggestions as to what to do now.  Finishing next week and ideally wanted to have sold the car and cleared the loan but that doens't seem to be happening.  Loan repayments are €250/mth plus tax is due in Oct.
> I've advertised in Autotrader and some of the other free car selling web-sites.  Thought some would want to buy it though- its reasonably priced compared to other similar cars on the market.  No calls at all (€6000 for 2003 Citroen C3 with low mileage)



First of all, what are you comparing it with? Garages or private sales? If you haven't had calls, then I guess it is not priced to sell.

Try advertising in the Buy and Sell (see what other similar cars are priced at), in supermarket notice boards and on the car itself. Keep dripping the price until it goes. Sadly cars depreciate fast.


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## Aesop (27 Aug 2008)

L&A said:


> Can't seem to sell one of the cars....(€6000 for 2003 Citroen C3 with low mileage)



Most expensive private sale below is €6000

*http://tinyurl.com/57anmb*


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