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Ask MP: Staying-at-Home Finances

I'd love to quit my job and stay at home with our kids. I think we can afford our regular expenses, but I'm still a little freaked out. Should I do it?

Don't freak, but do think beyond your monthly bills. If there's hardly a dime left, you're too close to the edge. It's best to have 5 to 10 percent of wiggle room, plus:

emergency money: Ideally, all families should have three to six months of living expenses. Don't have it? Set up a small automatic transfer to a savings account.

life insurance: If you died, your husband would need to hire a caregiver and maybe even a housekeeper. Can you afford life-insurance policies to cover the family until your kids are out of college? A $500,000 policy can be just $30 per month.

retirement funds: Getting by on one income now doesn't necessarily mean you'll be secure in retirement. So it's important to put some money in a spousal IRA.

This may help you know if you can stay home. Should you? That's up to you!

MP Dunleavey also writes a personal-finance column for The New York Times. Send her your money questions!

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