When a couple welcomes a child to their family, many may want one parent to stay home with the new addition, rather than returning to work.
But that decision comes with a number of tradeoffs. Having one parent stay home may help the family save money on child care, which can cost more than college tuition in more than half of states, according to data from the Economic Policy Institute. However, it could negatively impact that parent’s salary prospects or career growth if they later decide to return to work.
Another factor to consider is if the working parent’s income is enough to support the entire family. In Hawaii, a working parent needs to earn at least $102,773 a year to support themself, a non-working partner and a child, according to a recent SmartAsset analysis of Massachusetts Institute of Technology living wage calculator data.
The analysis includes estimates for basic living expenses, including rent, groceries and health care. It doesn’t account for discretionary costs like travel and entertainment, but includes cost estimates for basic apparel, household supplies and personal care products.
In Hawaii, the working parent needs to earn the most of any state to support a three-person household, the analysis found. However, if both parents work, the family needs to earn at least $115,814 a year to afford basic living expenses including child care, SmartAsset found. The median household income in Hawaii is just over $98,000, according to Census Bureau data.
