The big day comes and everyone’s beaming with pride: Your child is graduating from high school and preparing to enter college. It’s a wonderful moment worth celebrating, of course, but it could also lead to tension and stress between former spouses.
Who pays for college when the student’s parents are divorced?
Research shows that 29% of divorced parents helped their children pay for school, compared to 88% of students whose parents are still married. Divorced parents also provided a lesser amount of support to their college-bound students than still-married parents, reflecting the increased costs of maintaining two households.
This is an important conversation to have with your soon-to-be ex if your divorce isn’t yet final and you have kids. How will you split college tuition, or private school for younger children? Will you split costs evenly? Or pro-rata, based on your income? Will you cover a 2-year, 4-year or graduate degree? Or just 2-4 years of undergraduate study, if majors change, or other circumstances intervene? Public college or private university? Who will be responsible for helping your child apply for scholarships and for filling out the FAFSA? How much of the cost of college should be your responsibility vs your child working part-time and taking out student loans?
If younger children are involved, each parent can start a college savings or state-based 529 savings account, which comes with additional tax benefits. That way, money can be invested automatically and set aside, with interest growing as the child approaches 18. It’s dedicated funding that can be used as a foundation for further contributions from parents or other family members and friends.
There are also state laws to consider. Some states require payment for college-related expenses under the belief that failure to do so because the parents are no longer married is unfair to the child. But other states don’t have such laws, leaving it for you to sort out, or a judge to dictate, as a last resort.
These are crucial conversations to have during the divorce process. Establish early on that paying for continuing education costs is a must, even though the amount may be negotiable. The last thing your 18-year-old needs, after weathering the storm of a divorce, is to wonder whether she’ll be able to continue her dream of a college education after being admitted to her school of choice.
As a parent, you want to care for your child and provide all the support and assistance possible, given your new circumstances. That doesn’t change when the high school diploma is handed over. Your former spouse hopefully will feel the same: the same pride, the same urge to support and help your child fulfill her dreams.
Be sure to let your child know that their education is of paramount importance. It will not suffer as a result of the divorce. She doesn’t need all the details, just the reassurance that she’ll still be able to go to college and pursue her chosen field of study with the emotional and financial support of her parents, even though they’re not married any longer.
For more information on how to negotiate and structure paying for college in your divorce, and all other financial issues, please don’t hesitate to call me for a brief, free consultation.
You don’t have to do this alone!
Financial Transitions 