Cutting Back - Part One

I've always been of frugal mind, but becoming a Mom brought my natural inclination to the next level.

Having a kid helps you clarify things. My husband and I have always been savers, but seeing our finances through the lens of new parenthood made things all the more clear. For instance, when along the line had we decided that, unlike debts like credit card and car payments (which we detest), it was OK to hold onto student loan debt? Yes, there is an interest deduction for tax purposes, but, ah hem, given my husband's out of state tuition at the University of California (yes, the degree was worth it honey!), let's just say we were paying a whole lot more in interest than we were able to claim on our taxes. While we've been paying down these loans above and beyond the minimum payments for years, when our son was born all of a sudden we saw these loans for the burden that they are - monthly financial responsibilities keeping us from living on one income.

I absolutely loved the four months I spent with my son during my maternity leave and while I was at home I massaged our financial data to the point where we could have made it on one income - barely. As in, 'savings go-out-the-wazoo-and-we're-living-paycheck-to-paycheck' barely. The stickler? Those darn student loans.

We went through the whole stay-at-home Mom vs. working-Mom thing and were lucky to find a solution that presents the best of both worlds. Let's just say that I'm extremely blessed to work for an employer that was willing to work with me to find a part-time role that allows me to spend more time with my son while giving us the extra padding that we need to live without stressing about overdrafts.

And, I should add, a solution that helps us pay down those pesky student loans.

How, exactly, are we making do? After all, when you include the cost of childcare, I'm making less than 25% of what I was making previous to my maternity leave. (Ouch - it still hurts.) Plus, in an effort to prove that we can do it on one paycheck, we are living off my husband's salary and nearly 100% of what I make above and beyond childcare is going to student loan payments so we can finally rid ourselves of those debts.

Continued in Part Two...