Crystal Paine is known online as the “Money Saving Mom.” The focus of her site is deals and sales, but her new book coming out next month has a different twist. It’s called Money Making Mom, and taps into a particular economic and cultural phenomenon that’s worth examining.
Here are some realities. Middle-class incomes have been stagnant (if not declining) for a while. It’s hard for most families to live decently on one income. However, childcare is incredibly expensive. I’ve blogged before about the economics of this: if you have two young kids in a good quality daycare center, you generally need to earn more than $50,000 to break even. Given that the average woman working full-time earns less than $40,000 a year, this doesn’t exactly work. To be sure, many people do make it work, through family care, home-based daycares that may have more flexibility and lower costs, shifting schedules so parents work at different hours, etc. But it’s not easy.
So if families need the second income, but can’t afford childcare, what can be done? The answer for many is to seek out work-at-home gigs. These are seen as the best of all possible options — in theory, earning money without having to shell out big bucks for childcare! — and so desirable that half the ads online tout how you’ll “make $8000 a month working from home!” They don’t even say what kind of work you’ll be doing. The fact that it can be done at home is the major selling point.
The vast majority of this is scam. The first hard truth about working from home is that no one is hunting around for people to pay large quantities of cash to in exchange for them doing low-skilled work at home while the baby naps.
There are two legitimate ways to make a good income working from home. Crystal’s book focuses on one of those: starting a business. If you’re entrepreneurial, there are all sorts of things you can do, and technology has made scaling up a business possible in a way that it wasn’t before. If you made crafty things in the past, your market was limited to the stores where you could sell your wares, or the people who stopped by your booth at craft shows. Now you can get on Etsy and get your wares in front of the world. Crystal’s a prime example of how you can take expertise on something (couponing, in her case) and turn it into a profitable empire.
The other legitimate way to make a good salary working from home is to get a regular job with a good salary and negotiate to work from home. Often people are able to do this a few days a week if they’ve built up enough seniority.
But — and here is the other hard truth — neither of these 100 percent solve the childcare issue for most people. If you’re working a conventional job with real hours but happen to be doing it from home, your employer is going to expect you to be focused on the job. You can see your kids during breaks but you still need someone else to be watching them. More likely than not, that someone will need to be paid. And while you can probably do something entrepreneurial in fewer hours than a FT job with a commute, and do it more flexibly once you get it going, building a business still takes time. Growing it requires an investment of hours. Crystal has written before of pulling all-nighters as she built her business, and has written on the blog that hiring a mother’s helper was one of the best investments she ever made.
I am grateful for my ability to earn a decent living working at home, but it has taken years of working 40+ hour weeks, with many of the things I’ve done needing to be done during business hours. Hence the full-time childcare.
In other news: I’ve considered writing a piece called “A cold-hearted capitalist’s argument for daycare subsidies.” Maybe if we called it school vouchers for the under-5 set…
Photo: Why does every stock photo about “working from home” feature a mom at a laptop holding a baby? Perhaps this is what perpetuates the myth that this works.
The key to our efficient schedule is flexibility. We’ve found a routine that works for us, but expect to change it as needed. My husband cut back on work and I spend some time working from home, so we only need daycare three days a week. One week he had to stay home with a sick kindergartener, so he put in some extra hours that night.
As you correctly point out, working different hours than your spouse is one of the few ways you can decrease your dependence on childcare, and the costs that go with it. I would argue that to really get ahead, you can’t rely on just one job, but you need multiple streams of income. “Side hustles” like blogging, writing, or making things to sell are a great way to increase your income by using the time outside of your 9-5. For example, blogging after bedtime or crocheting things during a soccer game.
@Harmony- I’m in complete agreement on the multiple streams of income concept. I’m formulating my business plan for next year, and I’m fascinated to see just how many places it’s coming from. There are downsides to this, to be sure (oh, the volume of contracts and 1099s!) but upsides too.
One issue on the 3 days vs. 5 days for other families — my experience with daycare centers was that you don’t get much of a break on going PT. Which makes sense, as the center still has its overhead, and it has to match the days you’re there with staffing or another child with the opposite schedule, which isn’t easy. In-home providers may have more flexibility, and use that as a competitive advantage, but a lot of stand-alone centers don’t cut you a break there. (At ours, the price for 4 days was the same as 5, and it was about $50 less for 3 days vs. 5 – not proportional at all. So if your income was cut proportionally by going PT, you were not coming out ahead at all… )
We have some experience with staggering work schedules to decrease reliance on childcare, and while it allowed us to wait until a year to put our firstborn into daycare, it was *torture* as a family. I think back on it now and can’t believe we did that. I worked 2 LONG days per week (10 hours+ Mon/Tue) and did about a half day’s worth from home/on weekends. My husband switched his schedule to work Wed-Sat, 10+ hours/day. We all had Sunday off together.
At the time it sounded like a good idea, but it was *exhausting* and quite frankly kind of lonely because the days for both work and at home with kid were loooooong. And our weekend was really just Sunday together. I wouldn’t choose it again, though I’m grateful that we had this option.
Now our kids are in school 5 days a week and I do dropoff while hubby starts work ridiculously early, and he picks them up at 3pm and handles the afterschool “stuff” while I put in a couple more hours of work. It feels much more like a team effort this way, maybe because each day doesn’t feel as long or lonely. We are extremely lucky to have work that lets us do this (we both work for large companies, but work from home) but there is NO way we could accomplish anything without daily childcare.
My pet peeve is people at my company who think they can work effectively from home with infants and no childcare. Sure, you may be able to get a couple hours of work when they nap or whatnot, but it’s not a sustainable regular arrangement and it makes managers really suspicious of people who “work from home”. 🙁
@ARC – that is one of my pet peeves too! And the stock photos of moms with babies at laptops.
I agree that staggering shifts as you all did can be exhausting and lonely. I think if it’s done because the money isn’t there, or a child has a fragile immune system, it might make sense despite the downsides. But I suspect some people do this because of a narrative that childcare is “bad.” I get emails from people about elaborate set-ups they’ve engineered so their children don’t have to go to daycare, and these are often written from the perspective of don’t I think this is awesome, and my answer is no. If it works for the person, fine, but there’s nothing bad about daycare. Indeed, I really loved all the things my oldest kid learned in daycare that I didn’t teach him.
I suspect the “daycare is bad” narrative is a pretty prevalent one, just like the narratives of what is a perfect mother. It causes people to make decisions that they might not make otherwise.
I’d love to read an article arguing for daycare subsidies. I’m tired of hearing people say :don’t have children if you can’t afford them. Its not always quite so cut and dry. You could also argue the necessity for paid disability leave for parents. As an employee of a local county government agency I highly value my accrued sick leave AND my amazing and affordable health benefits. Day care is a crushing expense that we are just dealing with, but thankful we have quality care and they we are fortunate enough to be able to afford paying the high cost.
@Angela – In general, I’m not particularly into government programs — however, my argument is that we already have a lot of stuff that people on the right side of the aisle generally support, and the reason we don’t have more working women-friendly programs that would accomplish the same things is that men designed all these programs. So, for instance, we have highways that help people get to work. I would guess that 90 percent of the people on I-76 at rush hour are attempting to get to work, courtesy of a huge investment by the federal government. Plenty of people on the right vote for highway bills. Guess what also helps people get to work? Childcare. Or consider Social Security — politicians of all stripes tend to fall over themselves to repeat their commitment to the program. Why do we have a program that pays older Americans not to work, and not one that pays moms not to work for the first 4 months of their babies’ lives? It could have been designed to have both, it just doesn’t.
Ironically (given the points Laura raises about Social Security), it also pays a significant fraction of the retiree’s benefits (as an additional amount) to help cover the expenses of said retiree’s dependent children.
A solution to the daycare-dilemma could be to team up with other parents in the same situation. When our daughter was about nine months and we were just starting our business we met people from next door who worked from home and had a daughter the same age. For more than a year one parent watched both children from morning till afternoon on weekdays and the other three went about their businesses. Then the girls went into a daycare center together (luckily it‘s widely available and affordable in Germany, but mostly for kids 3 yrs and older).
@Jeanne- when babysitting co-ops work, they are really awesome. I’ve heard of some fairly elaborate ones between neighbors (with coupons for hours and all that) – it would be a fun article to write. Some people do nanny shares too, which cuts the cost if you have people with similar hours.
I made less than $50k while I had 2 kids in full time daycare (I was working part time, but still paid for full time care for reasons you discuss above). the way I looked at it (and encourage others to see the same) is that although I was only netting something like $100 a week, once my kids both got to public school (or at least one), my costs dropped dramatically, yet I was not trying to re-enter the workforce. I would have lost technical skills and I think I would have had a hard time staying current in my field. I did work part time which coincided with the economic downturn, and I think I would have been laid off if I had not gone part time. I have ramped my hours up each year that my kids have gotten older, and that has worked well. Luckily my husband agrees, and has seen childcare as an investment in my career.
@Katherine – I agree that it’s an investment in your lifelong earning potential. If you go to college, you don’t just look at the potential leanness of those years, you look at the payoff over decades. On-ramping after an absence is really hard, and often comes with huge financial penalties. I think the Sylvia Ann Hewlett calculation was 37% of earning power gone with 3 years out.
The other thing I’d say is don’t just count the cost against your own income. If you’re co-parenting with someone then daycare is a shared expense. While that may not be how it’s calculated in reality for many families, looking at half the bill subtracted from after-tax income often looks a lot better than the total bill…
I would have to agree with the previous poster. I had two children 1.5 years apart and had them both in FT child care while earning less then $50k. Now at 34, I have a 5 and 7 year old in school and I’m at a point in my career I would have never dreamed of 8 years ago when I started this journey of parenting. I was able to save enough to take 12 weeks or more off with each child (thanks to FMLA) and I now have a position that allows me flexibility to come and go as needed for school commitments. I work from home a few days a week too.
I have fellow employees that just re-entered the workforce that don’t even ask for time off (they are saving their PTO) to go to their children’s school events, or gymnastics classes, etc.
In my opinion, you may sacrifice on the front end by working when you children are young, but my family has reaped the rewards of that hard work and sacrifice.
I think you’re on to something with the rebranding of day care subsidies! I currently work from home for a little over half of my hours- I’m onsite at a client ~15 hours/week, and the rest of the time I work at home, sometimes on contracted work, sometimes on my own projects. But we’ve kept the same child care arrangement we had when I was at a full time job- the kids are in school or care when I’m working. We’re considering doing away with the after school care next year, but are hesitant to do it because (1) it cuts into my flexibility to accept last minute work, and (2) my youngest is not yet old enough to reliably entertain herself while I work. I have a 3rd grader and a kindergartner. I think that the 3rd grader could easily just read, watch TV, play games… whatever until I’m done working. But the kindergartner interrupts me a lot. And there’s also the problem of the kids starting to bicker about whose turn it is to pick the TV show and things like that. I prefer to keep them in after school care for another year if we can. Luckily for me, I can charge a high hourly rate for my primary contracting work, so as long as I have about 15 hours/week of contracted hours, there’s no question they’ll stay in care.
@Cloud- for the most part, my 8-year-old can be around while I’m working too. He would happily disappear and watch videos or play games for hours. But yes, the others, not so much. I’m curious to see what schedule I’ll have when the kids are all older than 8.
As someone who has navigated the work-from-home while building a business pathway, I’m interested to read Crystal’s book. I know that from real-life experience, dialing up the childcare to dial up the work hours isn’t always feasible, especially for middle class families. Since my husband’s income barely covered our bills, there was no room for “investing in my fledgling business” at the beginning. I started with working while my mom watched my child. As she grew, I worked 2 days per week while she was at preschool for 4 hours a shot– often doing the calculation whether it was better to spend $4 at Starbucks and have 20 extra minutes or spend $2 on gas to drive home and have a little less time. After my son was born, I found a gym with a cafe and daycare that we went to 3x per week for a summer. As revenue (and my children) grew, we hired a part time nanny. Eventually he went to preschool, then full-day pre-K. Now, both my kids go to school from 8-3. I work a couple of hours before they wake up and rarely work after they’re done with school.
It is possible to build a successful business without traditional childcare, but it takes strategic planning, some of which was planning to live near family.
I think some of the push back to subsidizing childcare from the right is that many religious conservatives (male and female) honestly believe that it’s in a child’s best interests to spend those first few years of life at home, with their mother. The fiscal policy is clouded by the social–even if in practice, many women are working, even if the time studies show they are spending plenty of time with their kids. The deeply held belief still exists and I’m not sure there’s anything that is going to change it.
@Calee – It’s amazing how you managed to make it all work. I don’t know what the answer is on this for most people. Businesses often have start-up costs, and in some cases one of those start-up costs will be childcare. You can do some things to minimize all kinds of start up costs, but it’s hard to get them to zero.
Hi Laura. I used to watch a few moms who vlog on YouTube, and it seems like they make enough of an income from that kind of work (e.g., ads, affiliate links, sponsors). While vlogging is not for everyone, those who do it – and do it successfully to get a huge following – it seems like childcare is a non-issue because their children are part of the vlogs. It’s a fascinating mode of “voyeurism” that is now encouraged thanks to technology and other aspects of our culture these days.
@Jane- it is fascinating how voyeurism can lead to a profitable business model. One thing I’d say is that in some of the most successful bloggers/vloggers’ lives, some childcare still occurs. A big advertiser, or someone who wants to hire you as a spokesperson, is probably going to want to meet with you. And probably someone will have to watch the kids while you do that. There are conference calls about sponsored posts or vlogs… It’s still work!
I agree with Calee’s comment above. I also believe another key component is Discipline! You must be willing to treat it as a serious venture to be successful.
We used to work out of town but half of my paycheck went to daycare expense (we have two girls) so my husband and I took a full-time cleaning jobs in town which is only 5-minute drive. We work in different hours to get rid of daycare cost. I work in the morning while he works at night. Aside from our full-time job, we have “side jobs” too; I work with exchange students and he flips homes. This setting really works for us,financially speaking! I would love to read your take on daycare subsidy.
@Gladys – I think there are some fascinating pieces to be written about people flipping hours to minimize daycare costs. There’s a big upside (not having to shell out for daycare) but some downsides in terms of reduced family time, and each parent not getting much time “off.”
I have a job that lets me work from home (most of the time), but I prefer to hire a sitter and go work from coffee shops because I get so much more done. There are certain kinds of work I can do while the kids are home with me—the chug and plug tasks like email, for example—but deep thinking is not compatible with being the parent on duty. Before we had a babysitter in place to make my real work (core work hours, to use your phrase), I relied heavily on split shifts.
@Anne- I’ve been figuring out what work I can do with kids around now that I don’t have regular childcare on Fridays. Fortunately, there are naps, like right now!
Thank you for the article and discussion. I was a stay-ar-home mother who did freelance and volunteer work. I worked a paid part-time job (lower pay & responsibility than my earlier career) for flexibility. Then, we moved to the Northeast two years ago for husband’s promotion. It’s challenging to find fulltime work when you’re not entry-level, but not senior management either. Plus, I feel the pull to be available to my family, so avoiding 1 hr commutes, but that limits my options if I want to work for someone else. Still exploring in my job hunt. It has been interesting.
I agree that the allure for me is flexibility, not the idea of a baby on my lap while I work away.
Most employers are (somewhat understandably) not okay with we don’t care which hours you work as long as you get it done, yet that’s what so many of us need.