Divorce is stressful, especially if you have sacrificed your career to help raise your children.
You are left with questions like…
How should I approach divorce as a stay at home parent?
How will I provide for myself in the future?
Will I qualify for child/spousal support?
How will I pay for my divorce?
This guide will outline what you need to know about divorce as a stay-at-home mom or dad.
Know Your Divorce Options
In most mediations, the couple hires one lawyer who represents neither party, but helps to negotiate the terms of the divorce outside of court for the benefit of both parties. For the right people, mediation is a major time saver, and also can save a significant amount of money and stress. Mediation can be used in conjunction with other divorce options.
In collaborative divorce, each individual hires a divorce lawyer who assists them in negotiating the terms of the divorce. Each individual meets and counsels separately with their own lawyer and often a team of other experts in the areas of forensic accounting, mental health and child custody/parenting. The group then comes together and meets several times to work out the terms of agreement.
It is important to note that if the parties are not able to reach an agreement, they will be required to start their divorce process over with different attorneys.
An uncontested divorce is a situation when two parties are in general agreement about most aspects of their case. Often in an uncontested divorce, one of the individuals will hire an attorney to draw up the agreement, help to work out any small disagreements, and submit the paperwork.
When there isn’t much to divide/fight over, some couples will opt for a DIY divorce. While this is extremely cost effective, it comes with many financial risks. We recommend that at the minimum, you hire a family law attorney to review your agreement and ensure that your financial rights are protected.
An uncontested divorce is not the right fit for everyone, but it is a great option for some.
Going to court should always be your last resort. It is expensive, your dirty laundry gets aired out in public, and you give up an element of control because the judge ultimately decides the results of your case.
In some cases, it is necessary to litigate. It is important to find a divorce lawyer who has experience in every one of these divorce options. A good divorce lawyer will help you to analyze your case and discover which method is the right fit for you.
The Ins & Outs of Child Support
California believes that each parent is equally responsible for the upbringing of their children.
When a California judge calculates how much a parent will have to pay in child support, they will generally look at 4 things first.1.Income (net disposable & passive)
Disposable income is the income left over after taxes, health insurance, etc. Passive income includes everything from stocks, rental properties, unemployment benefits, etc. While gross income is where the court starts, careful attention is paid to net income, as well.
Deductions include things like child care fees, health insurance, your mortgage and property taxes, required retirement contributions, etc.
3.Child Custody Percentage
What is your child custody arrangement? Is it 50/50, or does one parent have the children more than the other? Custodial timeshare is a major component in determining child support. But just because a parent spends more time caring for the children does not automatically mean they will receive child support, depending on income and deductions.
4.Child’s Standard of Living
California considers it unfair if a child has to pivot between two very different standards of lifestyle. Child support is partially intended to balance out the difference in income between parents.
Child Support Calculator
There is a child support formula that California judge’s use to determine the exact amount of child support due. This formula is incredibly complex, and accounts for all four of the factors, plus some others. Still, almost all courts utilize a computer program to calculate child support, which has been approved by lawmakers and takes all required factors into account.
Does the Court Have to Assign Child Support?
Parents can come to a child support agreement and a child custody agreement outside of court, but the judge must sign off on it before it is legally binding.
A family law attorney will be able to help you create an agreement outside of court that will be accepted by the judge AND protect your rights.
The Skinny on Spousal Support
There are two different types of spousal support, temporary spousal support and “permanent” spousal support.
Temporary Spousal Support
Temporary spousal support, otherwise known as pendente lite spousal support, can be assigned during the divorce proceedings to give monthly income to the lower earning spouse. Temporary spousal support can be assigned as soon as a family law case is started.
To get temporary spousal support, you and your spouse can sign a written agreement or you can ask the judge to order the support. If you need to change the support amount during the divorce proceedings, both of these methods still apply.
Long-Term Spousal Support
Permanent (aka long term spousal support) is a monthly payment from one spouse to another that can last for years.
How long does long term support last? It depends on several factors. These include but aren’t limited to:
- The duration of the marriage
- The amount of income the working spouses earn
- The age and health of the parties
- The length of time it will take for the non-working spouse to become self supporting (the longer the marriage, the longer this is deemed to be)
How Much Spousal Support will you Qualify for?
If you are going to court to determine the amount of long term spousal support that you will receive, the judge will look at the following factors (per Family Code 4320).
These factors include…
- Length of the marriage
- Earning capacity (what you are capable of earning)
- Standard of living during marriage
- Age & health
- Whether you helped your spouse get an education, training, career, or professional license
- If you stayed home to raise your children
- Income of the working spouse
- Property owned by the couple
- Debt of the couple
- How returning to work will impact your children
- The impact of the current tax laws on spousal support
- Any history of domestic abuse
- Any other factor the court deems relevant
To get long term spousal support, you and your spouse can sign a written agreement or you can ask the judge to order the support (which means you must go to trial). If you need to change the support amount during the divorce proceedings, you will need to pursue either of these options.
Make a Career Plan
Even if you are able to obtain spousal support and/or child support, it is rarely enough to exclusively live on. It is important for you to show the court that you have made a plan on how to support yourself and your children in the future. This plan could include going back to school, getting a job that would give you experience towards a long term career, pursuing additional certifications, or taking a career explorations class in your local community.
Even if you aren’t sure what your next career move is, it is wise to try and gain meaningful employment sooner rather than later. Some readily available work-from-home job ideas include:
- Online teacher/tutor
- Travel consultant
- Customer service representative
- Data entry specialist
- Freelance (graphic design, marketing, copywriting, virtual assistant, etc)
- Virtual receptionist
Plan for Your Financial Future
If you have not been involved in you and your partner’s finances, planning for your financial future can seem daunting. Here are a couple of easy steps to get started…
Make a Budget
List out your monthly expenses. Determine what your true financial needs are versus your wants, and then create a budget. There are many free budget software tools available. One of our favorites (that has a great free version) is EveryDollar.
Open Your Own Bank Account
One of the first steps you need to take when getting a divorce is to open your own bank account. Having your own personal bank account is vital in establishing financial independence from your ex.
Note: once the divorce proceedings officially start, you will need to declare this account in order to fairly split up assets.
Open Your Own Credit Line
If you do not have your own credit card, it is important to open up your own line of credit. This will help you to start to build your personal credit score.
Start Saving for Retirement
If you have a 401k, you should make sure that you make monthly contributions. If you do not have a 401k, a Roth IRA is a great option if you want to start investing for retirement.
In order to invest in a Roth, you need to have “earned income” and earn less than $144,000 as a single individual. Your “earned income” can come from a side hustle or part-time job.
Meet with a Financial Planner
A financial planner will help you to create a long-term financial strategy and help you know where you will get the greatest return for your money.
How to Fund Your Divorce
If you have no personal income, you might be concerned about how to pay for your divorce.
There is no way around it, divorce can be expensive. Below are several ways that stay-at-home parents pay for their divorce.
If you sense that you are headed for a divorce, it is wise to set aside some of your money in an account that only you have access to for future legal fees. Once the divorce is underway, you will need to declare that account for a fair split (which, depending on your date of separation, may or may not be a 50/50 split).
Spouse Funded Litigation
California courts can order the working spouse to pay for the stay at home parent’s legal fees. A divorce attorney can guide you through the process of applying for spouse funded litigation.
Borrow from Retirement
While not an ideal option, some individuals borrow from their retirement accounts in order to fund their divorce. The goal is to reimburse the retirement account as soon as reasonably possible in order to limit any financial penalties.
Borrow From Family
Many stay at home parents borrow from friends or family and then pay them back with their divorce settlement. This option does not work for everyone, but can be a good option for many.
How to Keep Divorce Costs Down
Divorce does not have to cost a fortune. If you are strategic, you can keep the cost down.
In a divorce, it is important to remember that there is a finite pool of income and assets. The more you fight, the more money you both spend, depleting BOTH of your pockets.
If you and your spouse are willing to compromise (this does not mean you need to agree about everything), mediation is an amazing option. Mediation will allow you to walk away paying minimal legal fees and is extremely cost effective. Often, if you come in with an agreement, the mediator will charge the couple a lump sum fee for their services, which the couple will pay together.
It is important to note that even if you can’t resolve everything in mediation, it will still save you a lot of money. It is better to litigate over one or two unresolved issues than to sort out your entire divorce in court.
Our office specializes in divorce mediation and settling divorce outside of court.
Create a Divorce Binder
Time is money. The more time you save your attorney asking you for paperwork and information, the more money you will save.
I recommend that my clients put together a binder, full of relevant paperwork and information.
This binder should include:
- A list of your current assets + debts
- A recent copy of statements for each account
- Escrow paperwork for the house and any refi’s
- You & your spouse’s 401k/retirement balances
- A copy of each party’s year end pay stubs for the last tax year
- A copy of your last two years of tax returns
- A quick video walkthrough of the house and its contents (keep in a secure place on your computer, thumb drive or cloud)
Obtain a Written Fee Agreement
Expenses add up very quickly during the divorce process. Before you hire an attorney, obtain a written fee agreement. This agreement should outline how much you will be charged for the time of the legal assistants, paralegals, and your attorney.
It is also important to make sure that the costs (messenger fees, court copies, subpoenaed records) are not marked up. Depending on your jurisdiction, there should be no profit to the law firm for costs unrelated to hourly billing.
Many attorneys will not charge you for billing questions that you want to ask. Check with your potential divorce attorney if this is the case. After you hire them, don’t be afraid to ask for clarification regarding your monthly invoice.
Let Some Things Go
That couch that is five years old and is only worth a couple hundred dollars? You could spend thousands of dollars fighting over it, or you could put that money towards buying new furniture.
To be clear, you should not give away everything to your ex in order to avoid conflict. You should, however, be strategic about what you want to fight for.
You will likely have a lot of household items to split. If possible, divide out your stuff on your own. You don’t want to pay an attorney to help decide who gets the dishes or the rug (unless it’s a very expensive one).
Dividing assets is a cost-benefit analysis. Is what you want cost-effective to obtain? Share a list of your priorities with your divorce attorney, and be willing to let some things go.
Go to Therapy
Divorce is a difficult and life changing transition. You need a good emotional support system to help you navigate the stress and emotions surrounding it. You do not want that emotional support system to include your divorce lawyer.
Your divorce lawyer will usually charge by the hour. The more time you spend talking to them about details that are irrelevant to your case, the more money you are going to pay.
A therapist will help you to navigate the frustration and emotional stress that comes from your divorce. Your divorce lawyer will help to protect your legal rights and interests and ensure that the divorce logistics are taken care of.
If you want to save money, vent to your therapist about your ex, not your lawyer.
Getting a divorce as a stay-at-home mom or stay-at-home dad can be daunting, but knowing your options will help to reduce the stress surrounding the divorce. Your divorce does not have to destroy your family or ruin your financial future. You can come out of your divorce stronger on the other side.