Legal Law

Who will pay for the children’s college education after divorce?

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During the divorce process, parents have a long list of issues to discuss and resolve, including the division of their assets (e.g. house, cars, bank accounts, retirement accounts, pension plans, etc.), division of your debts (for example, credit cards, car loans, personal loans, home equity loans, college loans, etc.), child custody and visitation schedule, child support, and spousal support. In their Marriage Settlement Agreement (MSA), parents will often include who will pay for child care (usually divided equally), school fees, and extracurricular activity expenses. However, parents will not always include a directive regarding post-secondary education. They may not think about this issue when negotiating the terms of their divorce, especially when the children are still young and there are years to go from pursuing a postsecondary education. This can generate friction and discussion in the future, as the cost of technical schools and public and private university education continues to rise.

Many parents tend to think that a college education should and will be paid for by both parents. Unfortunately, very few states govern post-high school educational expenses and expect both parents to financially support their children’s college education. In California, child support is required by law to be paid until children turn eighteen (18) years old. Support may continue as long as the child remains a full-time high school student, is not self-sufficient, or until the child turns nineteen (19) or completes twelfth (12th) grade, whichever occurs first. In all cases, child support payments stop once the children turn 19. Additionally, California does not offer any legal provisions regarding college costs. If college costs were not addressed in your MSA, the court will not order either parent to pay for any college or technical school tuition or expenses.

California courts will enforce college education cost provisions if they are part of a Marriage Settlement Agreement or court judgment, so we strongly encourage parents to include cost sharing for postsecondary education in your divorce contract at the time of divorce. Since there are no legal guidelines in California, parents may decide to share expenses to suit their specific financial situation. For example, parents may agree to pay for public education, but not the full cost of private education, which can be much higher. Parents can also decide what additional expenses will be shared, including housing, food, books, etc., and for which the child is responsible separately.

It is also important for parents to agree on who will claim the child as a dependent during the college years. That parent may be eligible for tax-deductible college credits or expenses, and the lower-income parent may claim more credits. Additionally, when a child completes the Free Application for Federal Student Aid (FAFSA) form, the custodial parent’s finances are used to determine eligibility for financial aid. In this case, the lower income parent (which must include the income of any new spouse) will make the child eligible for more financial assistance. Finally, if the parents jointly own a 529 college savings plan at the time of the divorce, they will need to decide which parent will have control of the account. Since a FAFSA does not take into account the income or assets of the non-custodial parent, it may be beneficial to put the 529 plan in that parent’s name, to increase the chances of eligibility for financial aid.

How to pay for a child’s college education is a growing concern for many parents, especially divorced parents. That is why we recommend discussing this topic in depth during the divorce mediation process. An experienced mediator will introduce parents to several common options and help them decide on a personalized solution for their particular family and financial situation.

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