Does income moderate the satisfaction of becoming a parent? In Germany it does and depends on education

We investigate the role of individual labor income as a moderator ofparental subjective well-being trajectories before and after the birth of the first childin Germany. Analyzing the German Socio-Economic Panel Survey (SOEP), we foundthat income matters negatively for parental life satisfaction after the first birth, thoughwith important differences by education and gender. In particular, among bettereducated parents, those with higher income experience a steeper decrease in theirsubjective well-being. Income is measured as the average of individual labor incomewithin 3 years before the birth. We provide evidence that our results are robust topotential endogeneity between income and first childbirth using the individual laborincome at 3 years from the event, and for an alternative measure, i.e. the equiva-lent household income. Results are discussed in terms of different aspirations anddifficulties parents may experience, especially in terms of work and family balance.