There are many benefits for parents who decide to stay home with their children including being available for your kids. That being said, it is impossible to deny the financial reality of the decision to stay home. Below are some things to consider for those thinking about being a stay-at-home parent and for those who already are.

Special Funds and Insurance

Build an Emergency Fund

Before you make the decision to stay home, make sure you and your spouse talk about putting money (ideally a set monthly amount) into an emergency fund. Emergency funds are important for unforeseen circumstances like job loss or medical bills, and expenses like big appliances or car trouble. This is especially true when you have children. Should any of these things occur, it is even more important to have an emergency fund knowing there is only one full-time income to rely on.

The general rule of thumb is to have enough money saved to survive for three to six months without income. This means taking into consideration monthly rent or mortgage payments, utility and cable bills, insurance, debt payments, and living expenses like clothing and groceries. Once you determine how much the monthly number is, there are plenty of resources and calculators that can help you figure out how much you need to save every month to meet your goal.

Related: DR Podcast 302: How to Build an Emergency Fund

Have a Will

Stay-at-home parents may overlook this important legal document because many think it is strictly financial. In reality, the most important part of what goes into a will is making sure the courts know who you want to take care of your children. This should be a decision considered and made by both parents. In the event that the stay-at-home parent passes, there should be a legal document attesting to that parent’s preferences regarding their children and finances. If you are not bringing in an income, it is still important for you to have a will.

Save for Retirement

Though your job as a stay-at-home spouse does not provide an income, there are still ways to save for retirement. Before deciding whether or not to stay home, it is important to explore all of your retirement account options.

Get Life Insurance

Life insurance is typically thought of as a replacement for income from a job. Well, being a stay-at-home parent is a job, and it is one that takes a lot of money to replace. In fact, a recent survey valued the amalgam of jobs a stay-at-home mother does at $178,201 annually. That factors in things like childcare, driving, tutoring, housekeeping, and much more – all things that would have to be paid for should she pass away.

No one enjoys thinking about the possibility of parental death, but in the instance that it should occur, you want to make sure your family is able to carry on financially without you. Stay-at-home parents are no different than parents who are employed full-time. You and your spouse should sit down and value your job as a stay-at-home parent before deciding how much life insurance to purchase.

Income Alternatives


Earning a full-time income by investing is pretty tough; however, there are tons of resources out there nowadays that will help you earn a little extra cash by investing money. If you are confident in your investing skills, this could be an excellent way to passively earn money seeing as you can do it from just about anywhere, and it does not require a 9-5 schedule.

It is important to keep in mind that successfully investing takes money and risk, both of which may be in shorter supply at any point during your stay-at-home journey. Make sure you and your spouse are saving and have enough money to pay down any debt before you think about starting to invest on your own.

Related: How to Start Investing: A Complete Guide for Beginners

Consider Freelancing and Part-Time Jobs

If you have skills or experience that people are willing to pay for and the time to market those skills, freelancing can be a good option to bring in extra income and stay busy. Maybe you can turn your knitting hobby into an Etsy shop or use your artistic eye to build a portfolio as a freelance graphic or interior designer.

Or perhaps instead of staying home full-time, your employer will allow you to scale back your hours into a part-time job. You could also consider finding part-time work that interests you, or that you are passionate about, like an aquarium or a hospital.

In addition to the extra income, both freelancing and part-time work are good options to gain and hone transferable skills that may help you re-enter the workforce at some point. On that note, no matter what you are doing with your time as a stay-at-home parent, it is probably a good idea to keep your resume current, in case you need to prepare it at a moment’s notice.

Get Out, Find Purpose

For some, any time work becomes home, and home becomes work, life can start to become a mental grind. Among other things, the clear line between work and home, and the ability to get out of the house every day are benefits of a full-time job. Some people need more than just social engagements to feel like they have a purpose as an individual, and a routine weekly or monthly commitment can alleviate this.

If part-time work is not in your wheelhouse, then finding a place to volunteer for a cause or an organization you care about can be a good outlet. Volunteering with the Red Cross, a museum, or a local animal shelter, for example, can give you a reason to get out and do something that gives you purpose away from your family and your home life. Ultimately anything that benefits your mental health will have positive effects on your financial wellbeing.