My wife and I teach a pre-marriage finance class. We recommend that couples who are ultimately planning on one person staying home with children, start running their finances and their budget that way from the beginning. In my article “Squirrel Away Money While You Can” I pointed out that one of the prime times to save is before having children. With marriage happening later and children therefore starting sooner this important savings period has been crunched. Singles would do well to realize that they are saving for their future family’s financial sake.

It was therefore with interest I read Katie Kuehner-Hebert’s article in Financial Planning magazine entitle “One Income, Many Challenges.” Here is some great advice from the article:

Trial Run

Laura West, a planner at West Financial Advisors in Nevada, Iowa, says she recommends that couples contemplating a stay-at-home arrangement first practice living as if they had only one income for at least three months before one of them quits a full-time job. They may find that even though their expenses will be cut for needs such as day care, transportation and clothing, they may find it hard to continue to dine out frequently or splurge in other ways. Such couples should also bolster an emergency fund to cover unexpected household repairs.

We recommend that the trial run begin at marriage which should allow for a fantastic period of saving before having children. Here is some more great advice:

Life Insurance

Couples should buy life insurance on both partners, not just on the working spouse, says Judy Hagar, a CFP and partner at Wolters Hagar & Pratt Financial Planning in San Diego. If the stay-at-home parent dies, the surviving spouse can use the benefits to pay for outside child care, live-in nannies, housekeepers and other functions that had formerly been handled by the stay-at-home parent.

My wife and I followed this advice and bought 10-year term insurance, renewing it every ten years and then dropping the insurance as our youngest was heading to college. Here is some more advice for the stay-at-home parent:

Home-based business

If the stay-at-home parent or both parents operate a home-based business, both should be listed on IRS Schedule C and all related business documents when they file taxes, Hagar says. Some of her clients listed only the information of the spouse who actually filed the taxes, in effect denying the other spouse from accumulating Social Security benefits.

And finally another great piece of advice about funding priorities:

Stay-at-home parents should also make sure they are well on their way to funding their own retirement before paying for a child’s college education, she says. She adds that couples in these situations should consider having their children take out student loans.

“The best thing you can do for your kids is to take care of yourself first, because they have 40 years to pay those loans back at favorable interest rates,” Anderson says.

Financial planning is more about life-style choices to fit your goals than it is about making money. The financial considerations should all be built around what you want to do with your life.