This study examines how the receipt of the cash‐for‐care (CFC) benefit affects short‐ and long‐term risks of union dissolution.

Several theories predict that couples' gendered
division of labor decreases their risk of separation, either due to
increased partnership satisfaction or because it establishes economic
dependency. Family policies such as the Finnish CFC benefit, which is
paid if a young child does not attend public daycare, may encourage such
a gendered division of labor, at least temporarily.

Using Finnish register data, this study analyzes the
first childbearing unions of 38,093 couples between 1987 and 2009.
Discrete‐time event history analyses and fixed effects models for
nonrepeated events are applied.

The results suggest a lower separation risk while the
benefit is received as compared to couples who do not use it, but no
effect in the long‐term. Fixed effects models that control for selection
into CFC indicate postponement of separation until after take‐up.
Higher‐income mothers show a stronger postponement effect, possibly due
to greater income following leave.

CFC use, which signals a temporary gendered division
of labor and losses in mothers' earnings, predicts a lower separation
risk during receipt of the benefit, but not beyond.

Policies that affect the division of paid and unpaid labor at best only temporarily reduce dissolution risks.