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Are Two Household Incomes Really Better Than One?

Not too long after our first child was born, the Honeybee left her position as a paralegal for a bankruptcy attorney to become a stay-at-home mom. It was a decision that we had both happily agreed to before we were even married. That course of action effectively turned us into a single income family, and it’s a decision I’ve never regretted for one moment.

Yes, if the Honeybee had remained working, I figure we probably could have netted more than a quarter-million dollars in additional household income over the past 16 years. That’s not too shabby, considering it would have been treated as spare change. Then again, sometimes you just can’t put a price on things — and the intangible benefits of a stay-at-home parent is certainly one of them. At least it is to me.

There is no doubt that fiscally disciplined two-income households can provide monetary benefits that a single-income household can’t. The trouble is, more often than not, two-income households become ensnared in the infamous two-income trap. That is, most couples tend to put themselves at risk by spending to their household income level, rather than taking advantage of that second paycheck by using it to boost their retirement nest egg contributions, emergency savings accounts, and kids’ college funds.

Needless to say, a two-income family that ends up depending on every penny of household income to cover the monthly bills ends up being just as vulnerable to financial problems in the event of a job loss as a single-income family. Then again, maybe even more so, considering a two-income household is arguably twice as susceptible to a job loss.

There are advantages and disadvantages to both one- and two-income households. Just remember that a household with two incomes doesn’t necessarily guarantee a brighter financial future than one with a single paycheck. That’s because, ultimately, it’s not about how much you bring home, it’s about how much you spend — and save.

Photo Credit: Images_of_Money

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