That Time My Husband Went Back to University

Jordann Making Money

Last week I put the finishing touches on my emergency fund. After raiding it to pay off my car loan, it’s finally back up to the $10,000 mark that I prefer. Which is good, because I’m going to need it over the next 16 months. My husband is going back to school.

That’s right, in two weeks, we’ll be a one income household while my husband upgrades his education.

While this is the first time you’re hearing about this, my husband’s journey to return to postsecondary education began last summer. Since then it’s been a series of applications and references, some waiting, and a whole lot of research on my part. We found out he was accepted in March, for a program beginning at the end of May.

I’m so excited for my husband to go back to school because I want him to be the best he can be, but of course this does present some financial challenges. As soon as he received his acceptance letter (or, let’s be honest, before) I flew into action with my budgeting spreadsheets to figure out how the hell we were going to:

  • Pay the tuition
  • Live on one income for 16 months

I’ll go into the details briefly here, and then explore each point in depth in subsequent posts.

First, the tuition. The purchase of our home in 2016 (and subsequent renovations) and then the purchase of a car (and subsequent payoff) in 2017 means we aren’t exactly cash flush. We don’t have cash in the bank for the tuition.

When I realized there was no way we’d be able to pay the tuition with cash my mind immediately went to provincial student loans, which are interest free during the education period. I’m debt adverse, but I’m not 0% interest debt averse.

Unfortunately, Nova Scotia Student Assistance have determined that we also make too much money and have too many assets to qualify for interest-free student loans, so we needed to look at other options.

Using the Lifelong Learning Plan

We don’t have the cash for tuition, but we do have the money, in my Registered Retirement Plan (RRSP). So I’ll be using the Lifelong Learning Plan to withdraw money from my RRSP to pay for the tuition. The LLP allows you to withdraw $10,000 per year for post secondary education, up to a maximum of $20,000.

I plan to withdraw the maximum amount, use that money to pay for the tuition, and then pay the money back to my RRSP as soon as possible once my husband is back in the workforce. This short loan to myself will minimize the effect of missing out on compound interest while also avoiding additional debt.

Living on One Income

As anyone who has gone back to school as an adult can tell you, tuition is only half of the money equation. The other half is managing household finances when one of the earners is out of comission. Living onĀ one income is not easy, especially if you’ve set up your lifestyle to require both incomes to survive.

Fortunately, that’s where our frugal lifestyle will benefit us. Right now my husband and I do not live on 100% of our income. Without factoring in my freelance income, we live on about 60% of our income, the rest goes to savings or non essential spending like travel or home renovations.

If you include my freelance income, that number drops to about 48%. That means we only need a little less than half of what we are bringing to pay our mortgage and insurance, put gas in the car, buy groceries and feed our pets.

But that’s with two incomes and a solid freelance writing habit. Without my husband’s income, it’s a little tighter.

First, with just my full-time job and not including freelance income, we’ll have a budget deficit of $153 per month for only essential spending. That deficit can easily be covered by our emergency fund.

If you include my projected freelance income (which I hate to do because freelance is so unpredictable), we’ll have a budget surplus of $1,546 per month. That means, barring catestrophic car failure or home repairs, we should come out of this 16 month stint unscathed, and we might have a decent start on repaying the RRSP.

I’ll go into both the LLP and the budgeting details in later posts, but for now suffice to say that the next 16 months are going to be interesting.

FAQs

This life change is going to have a huge impact on us, and I’m sure you have a lot of questions. Here are some of the questions I am not going to answer, because I respect my husband’s privacy as much as he respects my need to share everything about our money on the internet.

  • What is your husband going back to school for?
  • How much will he earn when he re-enters the workforce?
  • What is the labour market like for said workforce?
  • What job was he doing before?
  • How much did he earn before?
  • What is the expected ROI on his degree?

Please don’t ask, because I’m not going to answer. Just trust that this is me we’re talking about, and I wouldn’t have encouraged him to pursue an educational upgrade that I didn’t believe would yield a positive return on our investment.

Have you or your spouse returned to school as an adult? How did you pay for it? I want to know!

Photo by Brodie Vissers