Child-care costs - the surprise that shouldn't be
There's really no excuse for buying a home and then getting ambushed later by day-care costs.
But then again, no one ever really seems to do this sort of basic research before they jump into the brave new world of homeownership.
I certainly fell into that category.
My wife Karen and I bought our fixer-upper in Natick in 2002 without a single discussion on what the cost of childcare would do to our budget.
Within a few years, we had three children and a tab of $3,300 a month.
That was basically most of my take-home pay as a business reporter at the Boston Herald.
And it was double our mortgage - roughly $1,600 a month at that point.
Fortunately, Karen's salary as a financial planner was enough to carry the mortgage and pay for our other expenses.
But it was tight - we could swing it because we bought a fixer-upper and stayed below the $300,000 mark.
We are the lucky ones - others stretched to buy a house and then found themselves taking on water fast when the kids started rolling in and day-care bills hit them over the head.
I am thinking specifically about a Sherborn couple who wound up in serious trouble after putting down $640,000 for a house during the bubble years. Their combined income wasn't bad - $150,000 - but the $3,000 a month in daycare bill wasn't manageable on top of their hefty mortgage payment.
I'd link to a story that ran on their woes, but they have enough to deal with without anonymous carping from the blogosphere.
So what's the point? It's better to do the math upfront, because, if nothing else, it will determine how much house you can truly afford.
You might not like the answer, but better to find out sooner rather than later.
Back when Karen and I were still child free and house hunting, we had enough combined income to have stretched a bit. Looking back, we could have landed a mostly functional house, but it would have cost us $375,000 instead of $280,000.
But had we stretched, we would surely have wound up in serious trouble later once those day-care bills started piling up.
In the end, after eight years of renovating capped by an addition onto the back of our fixer-upper, we wound up with a $412,000 mortgage. But at that point, our incomes and potential earning power had also expanded.
I hardly hold myself out as the ideal - there is no easy answer here.
But the cost of child care should not be an afterthought - it could easily take more of your paycheck than your mortgage.
