In the first part of this post, we discussed how a couple’s decision to have one parent forego paid employment in order to focus on raising children can impact the property settlement between the parties if their marriage ends in divorce.
That is why a stay-at-home parent – either a mother or a father – may want to consider getting a postnuptial agreement in place. Otherwise, he or she could be shortchanged in the division of property in the event of divorce.
In this part of the post, let’s look more closely at the economics involved in decisions about stay-at-home parenting and staying (or returning) to the workforce.
It’s important to keep in mind, in analyzing the financial impact, that child-raising years are also generally key career-building years. If a parent chooses to give up job opportunities in order to manage the household, the economic impact goes beyond the income that is given up from his or her paycheck.
This is because, once the parent is ready to return to the workforce, he or she may face many hurdles trying to get back into a job with comparable pay and responsibility to the one given up when the kids were small. Indeed, for many former stay-at-home parents those hurdles may seem almost insurmountable at times.
Realistically, too, it must be acknowledged that it is still women, far more than men, who choose to stay home. To be sure, there are more men who stay home to raise children than in the Mr. Mom-era of 30 years ago.
But whether by nature, nurture or a bit of both, there are still many more wives than husbands who give up their jobs to focus on raising kids. And the data show that these women often make less money when they go back to the paid workforce than they did when they left it.
Source: CNBC, “Why stay-at-home moms need a ‘postnup’,” Jeff Landers, Dec. 21, 2013