For a woman whose divorce coincides with Johnny’s acceptance to college, a proud moment can be fraught with bittersweet anxiety. Sure, Johnny survived the admission gauntlet and has been accepted to the college of his choice. But, then there’s that one thorny question casting a pall over all the good cheer: “Who’s going to pay for it?”
For some divorcing couples, the answer is uncomplicated. Money has been ear-marked for college, Johnny’s interests come first, everybody can agree on who will pay what. But for a couple whose divorce is more complex, college tuition can be a real bone of contention --especially if Dad has plans to remarry and might have other children, who will have their own tuition needs.
In short, divorcing moms must grapple with this harsh reality: Generally, child support payments stop when children reach the “age of emancipation,” which in most states is between age 18 and 21. Beyond that, unless ordered by the courts, there is typically no legal obligation for a parent to pay college tuition.
So, in the absence of a court order, the best way to secure funds for college tuition is to include the obligation in your divorce settlement agreement. You can:
- have the funds put into an escrow or trust account to make sure they’re available when needed, or
- get an up-front lump sum payment and manage the funds wisely so they’re available when needed.
If the terms have not been negotiated in a divorce settlement agreement, the courts can order a parent to pay for their child’s education –but that depends on the state in which the divorce occurs. Most states allow courts to order the non-custodial parent to help pay for college. A few, like Alaska, Nebraska and New Hampshire, do not, except in those cases where the parents had a previous agreement.
But don’t panic. In order to reach a divorce settlement agreement that covers your child’s college expenses, you’ll need to Think Financially, Not Emotionally®. Also, please keep in mind: Even in those states that don’t require paying for college expenses, the courts recognize the need for children to have a college education. Therefore, they can allow resolution of the issue to be part of the divorce settlement agreement, in addition to the amount and term of alimony and child support to be paid.
Let’s get back to the main question. How should you best tackle the college tuition question if you’re a mom who’s in the process of divorcing?
The answer is relatively simple. If you’re a divorcing mom –and even if your children are still very young –do not overlook including college expenses in your divorce settlement agreement. In fact, make sure your divorce settlement agreement specifically includes a written college support agreement in addition to any other child support agreements.
This college support agreement typically includes details such as what percentage of college expenses each parent is responsible for, limits on payments, restrictions on which college the child should attend, exactly what expenses will be covered, etc.
Plus, it’s important to remember that college expenses are more than the cost of tuition. Any agreement should also address room and board, travel expenses, books, extracurricular activities and a monthly allowance.
Still, acknowledging all the facets of college expenses doesn’t mean you’ll necessarily be able to reach an easy consensus. Each one of these details usually involves negotiation. For example, conflicts often arise about exactly what type of college education a divorced parent is willing to fund. Johnny may have been admitted to a prestigious Ivy League college, where tuition, room and board can add up to well more than $50,000 a year. But, Dad may view that as a luxury he can’t afford and so he’ll agree only to pay for four years at a state school, where tuition costs are significantly lower.
In New York, many divorcing parents agree to limit their contribution to what is commonly referred to as the “SUNY Cap.” This cap limits a parent’s obligation to a percentage of the cost of a State University of New York (SUNY) school. In other words, regardless of where the child attends college, if the SUNY Cap is applied, the parent is obligated to pay only the amount specified in the cap. (Parents in other states may agree to limits based on tuition at state schools in their area.)
Even something as seemingly straightforward as a tuition obligation cap can make for intense negotiation, though. As Daniel Clement points out in his article Divorce and the Costs of College: Applying a SUNY Cap, courts can have broad jurisdiction here, and they have sometimes concluded that there is no basis to impose the SUNY cap.
As you can imagine, things get even more complicated in situations where custody of the children is split, and Mom has custody of one child (or some children), and Dad has custody of another (or others). In these cases, the courts generally want to see the numbers balance and that one parent is not unfairly burdened with college costs. Factors such as how much each parent earns, the tuition expenses and other child care costs are factored into the equation.
Please be aware that ascertaining the future costs of college can be very difficult, especially if your children are still young, and unfortunately, most divorce attorneys don’t have the training or expertise to compute complex projections of future college costs and what the present value of those future costs would be in today’s dollars. A consultation with a divorce financial planner can ease your headache and help you better understand all the options available as you plan for a stable financial future for you and your children.
Jeffrey A. Landers, CDFA™ is a Divorce Financial Strategist™ and the founder of Bedrock Divorce Advisors, LLC (http://www.BedrockDivorce.com) a firm which exclusively advises affluent women throughout the United States before, during and after divorce. He assists women and their divorce attorneys with deciding on the most advantageous way to divide marital assets and enable them to negotiate more favorable settlements, especially when there are complicated financial and tax issues. Jeff also advises happily married women who have seen their friends blindsided by a divorce initiated by their husbands and wonder (wisely) how financially vulnerable they’d be in that situation. Jeff developed the nation’s first Just in Case(TM): Secure Your Financial Future,a one-hour program, which quickly shows married women how to be prepared in the event of a future divorce with immediate, practical steps. He can be reached at Landers@BedrockDivorce.com.
All articles/blog posts are for informational purposes only, and do not constitute legal advice. If you require legal advice, retain a lawyer licensed in your jurisdiction. The opinions expressed are solely those of the author, who is not an attorney.
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