Financial Advice – Stay At Home Mom

Decades ago, couples didn’t question which spouse would care for the children. It was a no-brainer: Childcare was the realm of the wife, who perhaps had never worked outside the home. Most women took for granted that once married, it would be their job to manage house and home.

These days, it’s not so automatic, but the overwhelming majority of at-home parents are still mothers. One major difference today is that many of these women have good educations and have forfeited well-paying jobs to devote their full-time efforts to child-rearing.

A typical story goes like this: Janet and Scott met in college, got engaged, and moved to the same city after graduation. Each landed a terrific job, worked hard, and earned an excellent salary. They furnished a beautiful apartment and continued to advance professionally. On their wedding day, the future looked very bright indeed.

When they were ready to start a family, Janet and Scott discussed how best to be parents and manage their careers. It was important to them both that one parent be home with the children. They agreed that Janet would take on that role. Both felt strengthened in the choice by having made it together.

As the years went on, the family grew, and Janet set aside the idea of returning to paid work. Even if she’d tried to pick up where she left off, it would have been impossible. She’d lost touch with her professional contacts, and the skills required to succeed in her field had changed since she last earned a paycheck.

With home and family duties in Janet’s hands, Scott was able to concentrate on his career, and he continued to excel. However, as expenses of family life continued to mount (the apartment had become a well-appointed suburban home and college tuitions loomed on the horizon), he came to resent the pressures of being the sole breadwinner. His resentment turned toward Janet. “Whatever happened to ‘when I go back to work?’” he wondered. “What does she do all day, and why couldn’t she be more like his female co-workers, who have both full-time jobs and thriving children?”

Just as Janet fails to see the strain developing in Scott’s life, he develops a convenient blind spot for her sacrifices, and forgets that the two of them chose this path together. When the marriage eventually comes apart, Janet faces life as a jobless single mother who’s seeking alimony from a husband who’s convinced she doesn’t deserve anything more than child support… and hoping the court will rule in her favor.

Unfortunately, Janet could be in for a major disappointment.

“What we often find is that many stay-at-home parents, either moms or dads, as is becoming increasingly common, go into the divorce process assuming that lifetime alimony covering full support is a given. In this day and age, however, this kind of expectation is simply not realistic,” New Jersey family law attorney Bari Weinberger, Esq. told me.

The reality is that family courts now typically expect you to support yourself. As women have become more and more a part of the professional workforce, the fully supported ex-wife is increasingly rare. In fact, many states have passed “alimony reform” legislation to make lifetime alimony a thing of the past.

“In states such as Massachusetts that have seen alimony reform laws passed in recent years, ‘permanent’ lifetime alimony awards are all but abolished, except under certain circumstances,” Attorney Weinberger said. “In other states [it] is still available, but is far less likely to be awarded just because a parent decided to leave their career to stay home with the kids. What is becoming more the norm for stay-at-home moms and dads is ‘rehabilitative’ or ‘temporary’ alimony that’s put in place to help the spouse get on their feet long enough to re-enter the workforce.”

Like many of her peers, Janet will have to immediately begin pursuing full-time paid work – and prove to the court that she’s doing so. Many women in this position end up taking jobs ill-suited to their education and skill sets. Their standard of living takes a nosedive.

If you are considering becoming a SAHM, don’t forget that it means taking a major financial risk. In leaving paid work, you’ll give up your salary, benefits, and peak earning years, as well as professional relationships, associations, and memberships. You’ll lose career momentum that you are unlikely ever to regain.

If you recognize those realities and are still willing to take them on, a formal postnuptial agreement is in order. After all, great risks warrant great protections. Working out a postnup with your husband to ensure your future financial security provides an excellent opportunity to clearly set forth the financial implications of your decision. To my mind, a prenuptial or postnuptial agreement is an absolute legal and financial necessity for any woman choosing to give up paid work to stay home with her children.  

“If a couple never executed a prenuptial agreement, or does have one, but it doesn’t address spousal support, it can feel like you’ve missed the boat. Thanks to postnuptial agreements, you still have time to establish provisions to protect you financially should you make that leap to stay home and raise your kids,” noted Attorney Weinberger, adding that postnuptial agreements can specify alimony amounts and address other asset division issues.

You might like to think it couldn’t happen to you, but divorce is a social reality. So let Janet’s story serve as a cautionary tale. Wherever you are in your decision about how to raise your family — considering different options for the future, or managing the path you’ve chosen — it’s important to understand how common Janet’s story is, and to understand that these days, the legal system is not necessarily on her side.

Jeffrey Landers is a member of the DailyWorth Connect program. Read more about the program here.

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