Spouse Employment: Calculating the Cost of Working

Are you preparing to return to work after some time away from the job market? You already know you need to update your resume and prepare for interviews, but you may also want to consider the cost of returning to work. Child care and transportation costs can add up, and in some cases may be higher than the salary you are earning. Work through the simple calculations below to determine if going back to work is right for your family.

Step 1: Calculate your expected monthly net income.

How much do you expect to earn each month at the prospective job?
Subtract the amount that you would pay in federal & state income tax, FICA, pension and investment contributions to get your projected monthly net income.

Step 2: Determine what it costs you to work outside the home. Consider:

• child care costs
• professional wardrobe costs
• transportation & parking costs
• food (e.g., lunches at work, increase in dining out or takeout meals)
• miscellaneous costs (e.g., coffee, office gift fund)

Step 3: Subtract what it costs you to work outside the home from your monthly net income. How much is the surplus or deficit?

Step 4: Consider the following questions:

• How much of a surplus do you need to make outside employment worthwhile?
• What are your financial goals?
• What are your professional goals?
• What are your personal goals?

Is your salary higher than your anticipated costs? That’s great! It’s time to start sending out your resume. Be sure to also keep these calculations in mind when you are negotiating your salary.

Still looking for more in-depth assistance with spouse employment?  Learn more through your installation’s Family Member Employment Assistance and Personal Financial Management programs.