Stay-at-home moms and dads can take heart, however, because all that work, albeit from home with a gaggle of kids in tow, may be the very reason your spouse was able to prosper in the work place to begin with. Indeed, the fact that you stayed home may have helped you and your spouse “make bank” because “single-income households can have several financial advantages over dual-income households”.
Take for example, what a Harvard economist refers to as nonlinear compensation, meaning that earnings increase the longer the hours worked. This model is prevalent in fields of law, finance and business where allocating the earning responsibility to one spouse can result in more income than either spouse could earn on their own.
A large part of nonlinear compensation premium comes from being able to work at the drop of a hat and put in extra hours as needed, day or night. Spouses that divide the duties – one on a career, while the other runs a busy household – typically see more earnings in the long term than having both spouses putting in 40 hour weeks at the office. Right or wrong, think “job promotions” and who gets them – a harried parent leaving work early to pick up the kids or the employee burning the midnight oil? The contributions of a stay at home mom or dad cannot be understated or go uncompensated when the going gets tough.
On that note, the single income approach works best in marriages that last of course. But, for those that do not, that is where alimony comes in and by extension, a pre or postnuptial agreement. The spouse who stays home is the most vulnerable financially speaking simply because they are out of the workforce, sometimes for decades. A prospective stay-at-homer should, at a minimum, seek an arrangement with their spouse to be adequately compensated for their time out of the labor market when considering a prenup.
If you are already talking divorce and there is no agreement in place, spousal maintenance and the division of marital assets may level the playing field. Courts will most certainly take into consideration contributions to the marriage such as raising the kids or other household duties, the duration of a marriage and each spouses income earning potential to determine what is fair. It is important to get an experienced attorney to represent you in divorce negotiations.
Stay at Home Parent in a Divorce
Contact an Illinois Alimony Attorney with Decades of Experience
If you are a stay at home parent, are considering divorce, and you have questions regarding Illinois marital property division, alimony (spousal maintenance), parenting time arrangements or child support, contact the Illinois family law offices of Ronald L. Bell & Associates P.C. for answers today at 847-495-6000.
Source: Wall Street Journal, “Why One Income May Be Financially Better Than Two”, by Derek Tharp, January 10, 2018.