Updated: May 5
Sigh. Being a parent is tough. REALLY TOUGH. If you're a working parent, you may find yourself being pulled in many directions. You may want to work from home, own your own business or alternatively, not work whatsoever. #StruggleFace
Some time ago, I did an Instagram Live where I addressed 3 important considerations for parents when it comes to the world of negotiating. If you missed the video, no worries! Here is the write up!
1: Ask about Dependent Daycare Plans
When negotiating a prospective role, you should ask whether the company has a Dependent Daycare Flexible Spending Plan. According to the IRS, if you paid someone to care for a child or a dependent so you could work, you may be able to reduce your federal income tax by claiming the Credit for Child and Dependent Care expenses on your tax return. I'm enrolled in a Dependent Daycare Plan at work and it helps me tremendously. It is a bit confusing for me but I'll try to explain it.
Each year, I enroll the federal allowable amount (which is $5,000) through my employer. You have to enter into the program with your employer. Given that I am paid biweekly, I get 26 checks a year. The amount that I am enrolled for is equally divided into 26 checks.
$5,000/26 = $192.31
I pay my son's daycare weekly as usual. I then submit my receipt to a vendor (whatever vendor your employer as set up) and get reimbursed for what I paid my employer. This uses my pretaxed dollars. When its time to file my taxes, I am able to fill out the required Form 2441 and submit it with my general taxes. It lowers my tax burden because it impacts my Adjusted Gross Income (AGI). I'm not a tax professional so go consult one on this...but its pretty amazing.
So if you have children under the age of 13, inquire whether the company has a program already in place. If it does not, ask how you can support it to get one. Some credit unions allow you to set up your own or through your employer. So go ask!
#2: Get Flexible Flexible Work Schedules
If you've recently started a family, a flex/remote working schedule feels...nice.
As a working parent, you want to do a good job but let's be honest - unless you're "saving lives" at your job, it is important but its significance only weighs so much.
Am I lying? So here are some considerations for flexible work schedules:
Flexible Work Schedule: Whether you get to work from home one day a week or two, it makes a difference! You can roll out of bed, get the kids out of the door, come back home and get to work. Or like me, you can roll out of bed, get 2 hours of work done - start your regular crazy morning and then take a proper nap during your lunch time! Working from home also saves you money on transportation and eating out. A bowl of Cheerios is a very fair lunch! Ask about this!
Summer Hours: Believe it or not, some employers will allow you to work Summer Hours. Summer Hours kick in when the children (regardless of age) get out. Rather than simply working 40 hours, Monday through Friday, you work 4 days a week at 10 hour days. Ouch. I know, it sounds awful. However, you're OFF ON FRIDAY! How many times have we complained about the need for a 3-Day Weekend?! Tip: do not ask about this during your negotiations with a prospective employer. Only ask if you're negotiating a promotion at your current employer.
Phased Return: if you are planning to start a family, ask about a Phased Return (to a current employer like stated above). These are most popular in Europe where the flowers are brighter and the air is cleaner. Oh my heart! A Phased Return is to work is an arrangement whereby an employee who has been off long-term sick from work, returns to their full duties and hours at work gradually, over a defined time period. I successfully negotiated a 3-day Phased Return for 4 weeks with my employer. I'm on it now and it makes a WORLD of difference.
It is so important to discover what your options are so that you have peace of mind.
#3: Reverse Engineer Your Check
When I first got my "real" job, I was offered a salary of $54,000. My eyes light up and I took because although I wanted to negotiate starting at $60,000, I realistically wanted $50,000. So when the hiring manager said, "we can pay you $54,000." I smiled and said "Okay!" What I failed to consider was the following:
Cost of health benefits (it was a small company so the cost was higher)
Federal Taxes (which is usually 18-20% depending on where you fall)
So in my mind, I thought taxes may take out 12%...once I get my check, I can ball out! LIES!
What you want to do is reverse engineer your check. Determine how much the cost of living will be the amount offered and include your taxes and benefits, if applicable. Had I reverse engineered my check, I would have seen the following:
$54,000 - $10,800 (tax) = $43,200
$43,200 - 6,000 (annual cost of benefits) = $37,200
$37,200 sounds drastically different from $54,000 doesn't it?! I didn't even include other benefits - you see where I'm going with this! It simply wasn't enough to live off given my expenses and new responsibilities. So please please PLEASE reverse engineer your check!
That's all for this blog post. If you learned something, leave a comment and please share this! This information is great for new parents and those of us that are a tad bit more seasoned.
Go and be great!