The Financial Impacts of Being a Stay-at-Home Mom

Purse Strings Approved Professional

Blog Series

The Financial Impacts of Being a Stay-at-Home Mom: Navigating Post-Divorce Finance

Self love hug as esteem and confidence for being woman tiny pers

The financial impacts of being a stay-at-home mom (SAHM) are many.

When planning for the birth of a child, some couples take a long, hard look at their finances to budget for a reduced income. For years, it’s been the societal norm that the man will be the “breadwinner,” and the woman will be the stay-at-home mom.  And for many families, this works out great!

But can we take a moment to realize that “stay-at-home mom” is a very broad phrase that doesn’t really capture all of what she does? For instance, many SAHMs not only care for the children, but they also care for their spouse and the family home. I know I won’t be able to list all the “jobs” of a SAHM, but here are a few to consider.

For instance, they are nurses when a child is sick, and… let’s be honest when their spouse is sick, they nurse them back to health too. SAHMs are household managers. They budget, menu-plan, shop, cook, clean, pay bills, drive school carpool, make medical appointments, attend school meetings, chauffeur their children to various activities, etc.

And while doing all of these things for their children and home, they still manage to be supportive and attentive to their spouses.

Oh, and did I mention that the monetary pay really stinks for a SAHM?  It truly does.

I’m active on social media, and I see the contributions of women to the family being devalued on a regular basis. When the family is splitting up, too often, the husband thinks that his wife shouldn’t receive part of the assets like the home and the investment account because “she didn’t go to work, I did.” But being a SAHM is much more than a full-time job. And while it’s hard to assign a monetary value on all that mom does, it’s time we start recognizing that keeping the kids alive, managing their busy schedules to ensure that they have a well-rounded childhood, and keeping the home livable, and generally ensuring that the whole family functions well….. is a very demanding job.

Becoming a single-income household can put a big strain on the family’s finances. Maybe her previous employment and income provided health insurance, covered certain bills, or gave the expendable income to eat out or make non-necessity purchases. Or maybe the income lost changes the outlook of savings and retirement.

The financial impact of being a SAHM can be especially significant if the relationship ends in divorce. Did you know that 87% of women go broke five years after divorce?

When a SAHM has put her career on hold and faces divorce, returning to the workforce after years on hiatus is often difficult. You feel like you’re behind in your skills, and you see that your peers have been promoted and are on a different career trajectory than you. You may find that you’re earning less than you expect because of your absence from your field. Your financial future may look scary.

Navigating your post-divorce finances can feel overwhelming. This may especially be true if you weren’t actively involved in managing the finances for your family. You might not know how much your family’s bills are, and you are probably worried about how you will afford all of it.

Remember that alimony and child support can help fill the gaps financially. But they’re not forever, and you need to work toward financial independence. Even if you are receiving support payments now, things can happen that are out of your control, and the payments could unexpectedly stop. None of this feels fair, but it is the reality that you need to be prepared for.

So where do you start if you find yourself facing divorce and you are a SAHM? I’m so glad you asked.

A budget is a must! Getting a handle on your finances is the best way to see where you are currently, where you want to be in the future, and what you need to get there. I prefer to call your budget a “spending plan” because it really is a plan for how you’re going to spend your money.

Think of everything! Yes, you need to plan for housing, food, insurance (auto, health, life), medical expenses, car payment, utilities, etc. But don’t only think about right now or the immediate future; think of what it will take to continue to provide for your children with or without child support. Will your children need braces? What about a college fund? Is it worth keeping the house simply because you love it or just don’t want your ex to have it?

Have a plan by making a realistic budget and start planning for your financial freedom. I’ve created this free home budget worksheet to help get you started.

You can do this. It probably won’t be easy, but it’s not impossible. And wait until your children see you conquer this and thrive!

Tracy Coenen, CPA, CFF

Tracy Coenen, CPA, CFF

Forensic Accountant and Fraud Investigator

I work with divorcing parties who have concerns about the money. While I can work with either party, it is most often the woman who is in need of my services. I focus on “lifestyle analysis,” which is a detailed tracing of funds through bank accounts, credit card accounts, and investment accounts to determine where the money went and how much the family’s lifestyle costs. My results are used to track down hidden money or make calculations related to spousal and child support.

I truly believe that knowledge is power. I am here to help inform the parties about their money. Where did the money go? How do we make sure there is a fair division of the assets and the income?

Should I just let my husband have everything he wants in our divorce?

Ask An Expert

Should I just let my husband have everything he wants (the retirement account, the house, etc.) in our divorce? It’s so overwhelming to think about fighting endlessly about these things.

Joann North

Answered By

Tracy Coenen, CPA, CFF

Forensic Accountant and Fraud Investigator at Sequence Inc. Forensic Accounting

tracy@sequenceinc.com

Question

Should I just let my husband have everything he wants (the retirement account, the house, etc.) in our divorce? It’s so overwhelming to think about fighting endlessly about these things.

 

Answer

No, no, no. You are entitled to a share of the assets, and even though the fight may be difficult, your long-term financial future depends on you securing assets for yourself. Of course, you don’t want to spend more on legal fees than you would receive in a property settlement, so you have to be strategic. But I recommend making a plan for what a fair settlement is and being firm in your demands regarding this. Don’t settle too early or for too little.

 Want more resources like this delivered to our inbox?

Join our newsletter!

Getting a Better Financial Outcome in Your Divorce

Purse Strings Approved Professional

Blog Series

Getting a Better Financial Outcome in Your Divorce

Self love hug as esteem and confidence for being woman tiny pers

The divorce process hasn’t changed much over the years, but the financial issues in divorce certainly seem to be getting more complicated. As a forensic accountant who specializes in helping women get better financial outcomes in their divorces, my job is to trace and find the money. I’ve helped many women uncover money their husbands are hiding and I want to help you, too. Not everyone has the means to get a forensic accountant to help them figure out where their family’s money has gone, but guess what? You can do a lot of the legwork yourself.

Make a list of every bank, credit card, and investment account that you have with your soon-to-be ex. You need to get account statements for all of these, and the sooner you do it, the better. Don’t risk your husband cutting off your access…. Get the statements now. Doing this work now saves your attorney headaches later, and also saves you money. If you don’t have access to accounts that you know exist (such as a bank account in his name only), your attorney can get the account statements with a subpoena.

Stay-at-home moms may feel additional stress in the divorce process because they are not only worried about living arrangements, but are often looking for employment outside of the home to start supporting themselves after divorce. Many women who stay at home caring for the children, running the household, and supporting their spouses are blindsided by divorce. Their whole way of life changes and that can be scary, but if you find yourself in this position just know that you are not alone.

Don’t be ashamed if you didn’t manage the bills and have no idea what your spouse has done with all of the marital money. This is a common arrangement and just because you do not work outside of the home doesn’t mean that you aren’t entitled to your fair share of everything. It’s common during the divorce for the main breadwinner to say “this is MY retirement account” or lay claim to other assets saying they paid for them. You are entitled to part of those assets even if your name wasn’t on the paycheck, so don’t believe the threats and don’t just give up.

Your journey to journey to financial security after your divorce starts with a little planning. Start with a budget, looking at what your post-divorce costs will be. If you want to stay in the marital home, first, make sure that you can afford it on your post-divorce income. Write down all costs associated with the home, including the mortgage payment and taxes, lawn maintenance, repair and cleaning services, home-owners association dues, utilities, etc. It’s essential to be realistic to secure your financial future.

There are so many things you need to do to protect yourself financially as you begin the divorce process, and it often feels overwhelming. But there are lots of resources out there to help you get organized and navigate the finances. Don’t get discouraged. Take things step-by-step, and don’t be afraid to ask for help from a professional who has been down this road before.

Tracy Coenen, CPA, CFF

Tracy Coenen, CPA, CFF

Forensic Accountant and Fraud Investigator

I work with divorcing parties who have concerns about the money. While I can work with either party, it is most often the woman who is in need of my services. I focus on “lifestyle analysis,” which is a detailed tracing of funds through bank accounts, credit card accounts, and investment accounts to determine where the money went and how much the family’s lifestyle costs. My results are used to track down hidden money or make calculations related to spousal and child support.

I truly believe that knowledge is power. I am here to help inform the parties about their money. Where did the money go? How do we make sure there is a fair division of the assets and the income?

We will provide you useful and timely information you can use to be #financiallyfearless

Financial Planning for Divorce: Tips for Every Stage of Your Relationship

Purse Strings Approved Professional

Blog Series

Financial Planning for Divorce: Tips for Every Stage of Your Relationship

Self love hug as esteem and confidence for being woman tiny pers

Divorce is one of the most awful things you can go through. (How’s that for an uplifting lead into a blog post?)

The process is overwhelming and there is so much to accomplish it. But a plan can help you have a better outcome in your divorce. 

As a forensic accountant specializing in helping women going through divorce, I have seen many cases of poor planning or lack of planning altogether when it comes to finances.

A plan for your financial future can help you, no matter the stage of the relationship you are in.

If you are engaged, your focus is on planning your wedding, of course. During this process, it’s easy to get wrapped up in the event-planning, catering, logistics, etc., but I want to encourage you to remember your financial future and consider a prenuptial agreement as part of the planning process. 

I know, prenups get a bad rap, but just hear me out.

You don’t want to think about divorce while planning a wedding and I certainly don’t want to see you in that situation. But discussing finances at the beginning of a marriage can be so positive.  For example, getting on the same page about your spending plan (also known as a budget!) can help avoid painful disagreements later. Agree now on the acceptable spending limits, your long-term savings goals, and when is important to both of you regarding the money. The prenup also protects your assets, both now and in the future. It protects both spouses, no matter how much or how little you have right now.

If you are currently married, but are considering divorce, start by making a list of shared accounts and credit cards, gathering documents, and writing down important dates. One of the most important things to do for the financial part of your divorce is to gather all of this information. If you begin now, you’ll have a head start that may ease your burden later in the process.

Even if you are right in the middle of your divorce and approaching the light at the end of the tunnel, there’s still time to plan. A solid financial plan for your post-divorce life is so important. You need to know exactly what your expenses are going to be so you can figure out where you will stand financially.  It can be scary to think about paying for all your expenses on your own. A plan for your new budget is a great place to start. Know your numbers. 

Once your divorce is final, you can still benefit from planning. What does your income look like? How much do you need to set aside for retirement? What are your fixed monthly  costs like rent, mortgage and car payments?  Don’t forget to start an emergency fund, even if you can only set aside a small amount of money each month. Even $50 per month may come in handy when you have an unexpected auto repair or medical copay. A safety net of an size can be a great help.

Divorce is scary, especially when it comes to the finances. It is hard to do it all on your own, but if you take some time to plan, you will be better prepared for whatever comes. 

Tracy Coenen, CPA, CFF

Tracy Coenen, CPA, CFF

Forensic Accountant and Fraud Investigator

I work with divorcing parties who have concerns about the money. While I can work with either party, it is most often the woman who is in need of my services. I focus on “lifestyle analysis,” which is a detailed tracing of funds through bank accounts, credit card accounts, and investment accounts to determine where the money went and how much the family’s lifestyle costs. My results are used to track down hidden money or make calculations related to spousal and child support.

I truly believe that knowledge is power. I am here to help inform the parties about their money. Where did the money go? How do we make sure there is a fair division of the assets and the income?

We will provide you useful and timely information you can use to be #financiallyfearless