It's a question every parent has struggled with: Can you afford to stay at home when you have children?
The answer has always been complex, often involving a lot of number crunching and a plain, old-fashioned trial run. But in this economy, things are even more complicated. In July, the unemployment rate stood at 9.4 percent, and 247,000 jobs were lost. The message is clear: Few jobs are truly secure, and the decision to give one up shouldn't be taken lightly. It's entirely possible that you'll submit your resignation, settle into a routine and then find out that your spouse's company is restructuring and his job was one of the casualties. 

So not only do you need to consider the change in income and expenses, but you also have to put precautions in place so you're protected in case things don't turn out as planned. Here's how to do both.

Evaluate Your Financial Situation
I hate to say it, but if you have a lot of credit card debt —in the thousands, not the hundreds—you're probably better off staying in the workplace, or at least not pulling out completely. It's not smart to give up an income when you're deep in debt, and, on an emotional level, you don't need another thing to worry about. "You really need to get rid of significant credit card debt before you drop down to one income. Especially if it's a big number, it will really drain you," says Jackie Goldstick, a financial planner with Family First Financial Planning in Florida. 

Along the same lines, I want you to have at least six to nine months' worth of expenses stashed in a liquid savings account before you even consider giving up your full-time job. Twelve months' worth is even better, particularly because you're dropping down to one income. (One way to easily beef up your emergency fund is to practice living on one income while you're pregnant. Bank the other, and you'll have quite the cash cushion at the end of nine months.) 

Finally, try to be as realistic as you can about the job security of the partner who is going to continue to work outside the home. You can never be absolutely sure that your job is secure, but you can certainly look for clues that it might not be, including other lay-offs, a restructuring of departments, a reduced workload or major cuts in the company's spending. If any of these are prevalent at the office, this might not be the time for your family to give up a second income.


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