<prompt> Human: So my wife and I make about 86K per year combined I make 51K she makes 35K. We have both lived in a house we bought in the Suburbs of the Greater Toronto Area for almost 2 years now and we are currently both 26 years old. We have no debt other than the house and one 0 interest car loan and we are starting to try and plan for children in the next 2 years or so but we cant figure out how to make the numbers work without digging ourselves deep into debt during the first 4 years of the kids life before they go to school.So here are the particulars, we make about 4500 per month free and clear after taxes.Housing: 260K house, worth about 300K now, 229K owing on the mortgage. We pay about 1260 per month for all things associated with the house mortgage, taxes, insurance and utilities which is actually 1760 per month but we rent our basement in-law apartment to my father in law for 500 per month so that comes off the top. This house is small 3 bedroom 800 square foot bungalow but big enough we think we can manage with kids if we never were able to move again, but would probably want to take over the basement at some point if we had more than 1 kid. Transportation: 2 cars, insurance is 250 per month for both, gas is 280 a month for both, one is owned outright and has a 50 per month maintenance budget and the other is new and has a 360 per month 0 interest loan yes I know its a big payment and that payment equals me buying 32K car but its an electric car and I was previously spending about 360 a month on gas to commute to my 60km away in my previous car that I had paid off and was becoming unreliable out of warranty. Total cost here is 940 a month.Savings: About 900 per month when you include general savings, RRSP and emergency fund building my wifes emergency fund is built, I am still building mine. Its about 20 of our income. Life everything else: About 1400 per month. This includes our cellphones at 150 per month, groceries, supplies and personal care at 560 per month, internet at 50 a month, our licencepassportetc. renewal savings about 25 per month, 150 a month for restaurants and entertainment, pet fund, medical and dental at about 200 per month savings for out of pocket expenses and our health insurance plans, hobbies at 50 per month, clothes at about 70 per month, gifts savings at about 100 a month. The rest goes to paying off a fridge we bought on a 0 for 12 months offer when ours bit the dust yes it will be paid back before the 12 months and a small vacation savings fund. When we ran the numbers for year 2-4 where I am really worried after mat leave but before school and it looks like we need about 1100 per month for daycare and 500 for kid expenses for 1600 per month total in kid related expenses we dont have now. I pared back our savings, gas budget and cut out everything fun from the life side of our budget and found about 600 a month that could be freed up so we are 1000 per month in income short with us both working. If she doesnt work the 1100 daycare expense goes away but we lose 1600 a month in income and have 500 in kid expenses so we are 1100 in income short on that route. So basically I am proposing we would have to make 105-110K per year combined to afford a kid and that just seems ridiculous. We are not exactly living an extravagant life, generally middle class at best. That or I probably need to be in the 85K per year income range alone to afford my wife staying home.So all that said, we are working towards that income increase as our goal, but seriously how do people do this without going into credit card and line of credit type debt? Is there some magical thing I am missing???  <response>: So all that said, we are working towards that income increase as our goal, but seriously how do people do this without going into credit card and line of credit type debt? Is there some magical thing I am missing???Based on my friends andor coworkers who have kids in Toronto...1. Use retired parents hypothetical kids grandparents as free childcare.2. They make a lot more money.3. They just go into debt and will figure it out later.Also everyones just told me Just have the kid. There will NEVER be a time where youll ever feel 100 financially ready. 