Valuation of a Homemaker's Contributions to the Marriage and Family
Valuation of a Homemaker's Contributions to the Marriage and Family
In a majority of states, a court will consider a spouse's economic and noneconomic contributions to the marriage and family when ordering property division, spousal maintenance (alimony), or both. The services of a homemaker spouse are often a significant intangible contribution to which a value must be assigned to ensure a fair distribution of marital property. Because no two homemakers are alike and a homemaker's services are inherently difficult to quantify, a homemaker should present to the court all relevant facts and expert opinions regarding his or her contributions to the marriage and family.
Homemaker Contributions
A homemaker spouse's contributions to his or her marriage and family include intangible contributions and contributions for which he or she is not directly paid. These contributions include:
- Housekeeping services (cooking, cleaning, doing laundry)
- Parenting (taking care of the emotional, physical, and educational needs of the children)
- Engaging in work related to the other spouse's business
- Enabling the children and the other spouse to pursue opportunities (relocating to further the other spouse's career or career potential, taking time off work or changing careers to meet the needs of the children or other spouse, missing out on other opportunities in order to accommodate the other spouse)
Valuing a Homemaker's Contributions
Depending on the circumstances of a particular case, the jurisdiction, or both, the court's method of valuing a homemaker's contributions will vary. Possible methods of valuing a homemaker's contributions upon dissolution of marriage include:
- Opportunity cost approach. Under the opportunity cost approach, the homemaker's contributions are assigned a value equal to what the homemaker would have earned had he or she worked outside the home. The opportunity cost method may also be appropriate if the homemaker spouse missed out on employment opportunities or experienced interruptions in work to handle family obligations or to further his or her spouse's career. Under this method, courts typically assume that the foregone opportunity would have been the next-best and most financially rewarding opportunity and assign a value accordingly.
- Replacement approach. Under the replacement approach, the homemaker's contributions are assigned a value equal to the market rate of hiring another person to perform the homemaker's services. Depending on the circumstances of a particular case, the value of the homemaker's contributions may be based on the market rate of specialists (a bookkeeper, dietician, or nurse, for example), the average hourly wage for a particular service based on historical earnings data (such as data from the Bureau of Labor Statistics), or the market wage for hiring a housekeeper.
- Dissolution of partnership approach. Under the dissolution of partnership approach, the economic contributions of one spouse during the marriage are attributed to both spouses and divided equally upon dissolution of the marriage.
- Breach of implied contract approach. Under the breach of implied contract approach, the homemaker's contributions are assigned a value to compensate a spouse who chose to forego employment outside the home under the belief that his or her spouse would provide the necessary economic support.
Conclusion
The value of a homemaker's contributions to the marriage and family is determined on a case-by-case basis. To ensure the equitable distribution of marital property, a homemaker spouse should solicit the assistance of economists and other valuation experts and present to the court all relevant facts, data, and expert opinions concerning his or her nonmonetary contributions to the marriage and family.
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