Million Dollar Journey posted about the financial angle of one of the parents opting to stay at home with the kids. I only have one minor point to add (Update: MDJ has updated his post to include CCTB benefits) to his analysis: You’ll also have to account for the Canada Child Tax Benefit (CCTB), a tax-free monthly payment made to eligible families with children under 18. The CCTB is based on your family’s net income (line 236 of your tax return), which for most people would be total income less RRSP contributions, child care expenses, loan interest deductions etc.
For the scenarios detailed by Million Dollar Journey in his post, I used the CCTB benefits calculator to estimate the payments for a Quebec family. In Scenario 1 where a spouse stays at home with the child, the family will be eligible for an annual CCTB of $1,800. In Scenario 3, where both spouses work, the family is eligible for a lower CCTB benefit of $310.
We grappled with this issue when our kids were a year old. For many families there is no choice: mom has to return to work to bring in an extra pay check to support the family. We were in a bit more fortunate position that we could afford to have my wife stay at home with the kids despite the obvious hit of giving up one pay check and the opportunity cost of my wife’s growth at her job.
The ideal solution for us would have been having my wife work part-time. It would have enabled her to keep up with the latest in her field and not having to start all over when our kids are about to go to school. Unfortunately, though she tried hard, she was unable to find a suitable part-time position. In the end, we decided that my wife would be going back to work because she would have been miserable giving up the social and professional aspects of her job entirely. The downside to both of us working is that our lives are so hectic that I don’t have the time anymore for activities like photography.
