Divorce is a difficult chapter in the life of any family. Of course there is the emotional wounds that come when a couple realizes that one or both spouses no longer wish to be married. While this is life changing for both the parents and the children, the financial element of a divorce is also an important part of the new equation.
Some families are financially secure enough where the parents are able to live in much the same manner as they did when they were married, but divorce often means making financial adjustments because the family now maintains a second home. Smart planning during divorce can nonetheless ensure that the money earmarked for tuition pays for schooling even after divorce.
Be realistic about obligations
Both parents need to understand what the priorities are. Obviously, food, shelter, medical care and other necessities are the priority. These need to be handled through child support agreements or spousal support. In California, the parents have obligation to cover these necessities. Parents are also obligated to pay for education or enroll them in a public school until they are 18, but they are under no obligation to do so after that age unless there is a stipulation in divorce agreement or judgment that is a legally binding contract.
A moral obligation
Just because there is no law on the books, does not mean that parents have no obligation. Perhaps it was discussed with the child or spouse and put in writing. Agreements generally include payments to a school that meets one or all of the following criteria:
- The best school the child can get into
- The school that the child wants to attend
- The school that the parents can afford
Most agreements will likely put an amount or window of time for paying for school, such as five years of tuition. Generally, graduate level work is not part of the agreement.
Get a 529 plan
Typically owned by one parent, this tax-free savings plan is specifically dedicated to paying for college tuition and valid education expenses. According to CNBC, this can be done years before the children are ready for college. They can also be transferred or split in two.
Attorney can draft a settlement to include tuition
A family law attorney who has experience handling divorce agreements, parenting plans and other details can provide initial guidance on important contingencies like education costs. When the estate of the client is large or complicated, it will often be desirable for an attorney to bring in financial experts who can provide additional guidance in setting up a 529 or other arrangements.