I talked recently about my sister who is a single mum making a low wage, and would be making more Money, or at least have more disposable income if she were to stay at home, take care of her kid, and receive a check from the French government every month. While I admire her courage to keep working, I think that is due mainly to the fact that she hasn’t run the number properly, and is not aware of the full picture. Of course, it would not be fun to take the kid to subsidized supermarket and shop for heavily discounted groceries while the cashier looks at you with pity in her eyes. But she would have free access to the swimming pool, tennis court, tons of museums and other fun things for her daughter as well.
That said, she decides to stay at her current job, which is very brave of her. But I often cringe when people tell me how much they make, then brag about how good of a salary that is, and are not able to open their eyes about the real money that comes into their pocket each month.
Every day, my sister drops her daughter at daycare so she can go to work. For most workers, that is one of the biggest expense of having a second working spouse. My sister pays around $500 per month, but she makes less than $2,000 so that is a huge chunk of her income. She works 4 days a week so she can avoid daycare on the fifth day, but that is not a big savings. In some big cities, daycare can cost over $1,000 a month so you really have to make a decent living for it to be worth it. I value my time a lot and if I had kids I think I would want to stay home and see them grow but that is a personal choice. I am simply suggesting that this is a cost you should deduce from your salary to see if the job offer is really worth it.
Car and maintenance
If you have bought a car because you needed one to get a job, go dig out your statement and write down how much money goes to paying back your car every month. Maybe you got bad credit car finance from Money Barn, or maybe your parents helped you out and you still owe them part of the car, the thing is you are paying all that money to go to work. Let’s take an example, if you took a $2,000 job half an hour from home and need a $500 car loan to get there, you could have accepted that $1,400 job one block away and walked to it. Because on top of your car, you are also paying for insurance, gas, maintenance, and every single month, your car depreciates a bit more. I am not even considering the time you are spending driving back and forth every day. For my sister, that means extra daycare time, that she has to pay for.
Because you are so tired when you get home, you probably won’t have time for proper cooking, a fresh load of laundry and taking care of your kids, all at the same time. That pizza night? $20 off your paycheck. Dry cleaning? Here is another $50. Would you dry clean if you worked a simpler job anyway? You may be buying ready meals, or in a less obvious way ready washed and chopped vegetables, simpler cuts of meat, all that is more expensive and you are buying it because you lack the time to do things yourself. You may have a cleaning lady too, or need a baby sitter once a week so you can relax and have a night to yourself.
Sometimes, because it advances your career, because it builds your CV, because you may improve and evolve well at your dream company, taking a low paying job can be worth it. But before you accept any offer, be sure to consider the hidden costs and your real salary.