If your children range from preschool to attending college, you understand the importance of education. And this fact is not lost on you now that you and your spouse head toward divorce. As a result, you wonder how to and who will pay for those current or future college-related costs.
Many issues surface in divorce negotiations. They include division of assets, alimony, child support and child custody. Your children’s college expenses also represent an issue that deserves attention.
Rising college costs
There is no doubt that college costs continue to rise. States provide fewer funds to public universities, while colleges compete for the top students by providing costly amenities that these students demand.
According to the National Center for Education Statistics, average tuition, fees, room and board for an in-state public college in Minnesota cost $21,611 in the 2018-19 school year. Private school costs in the state were more than double that at $45,198.
The amount each parent pays
Separating couples should make a point of discussing college costs during divorce negotiations. Here are some of the issues to address:
- Where the child will attend college: Costs vary, especially between in-state public schools and in-state private schools. Each parent may lobby for certain schools — some of which may be out-of-state. A compromise agreement may be the solution.
- The amount each parent pays: Some parents may choose to split the costs, while some may base those payments on a percentage of each parent’s income.
- A life insurance policy as a safety net: What if a parent dies before the child enters college? Life insurance policies may provide some safeguards for the surviving parent and child. This is a reason why each parent should have a life insurance policy. A certain portion of the insurance funds could be reserved for the child’s college costs.
- Investments in a college savings account: Perhaps the parents took the initiative, opened a 529 college savings plan for their newborn child, and make regular contributions. If such an account does not exist, the divorce negotiations may include an agreement that each parent invest in, manage and contribute to a 529 college savings plan.
- Pursue financial aid: This may require to parents to work together to secure financial aid, student loans and scholarships for the college-attending child.
In divorce negotiations, financial matters require attention. This includes discussions on how to pay for your child’s higher education.
Come to an agreement
Squabbles between spouses should not penalize their children, and this includes financial disagreements. For your child’s education, please set aside your differences and come to an agreement on how to pay for his or her college expenses.