If you are divorcing and have children, it is important to think about their well-being not only in the immediate future but down the road as well. If your children are young, college savings may not be on the radar, but it is something that you and your partner need to consider. Planning for college in advance can go a long way. If you and your spouse can put your differences aside it can help your children from being hurt in the future.
Some states will require divorcing couples to address the college issue during divorce proceedings. The state cannot require you and/or your spouse to pay for college, but they ask that you come to an agreement about how contributions to higher education will be made. In most states, parents will look at the cost of state universities to establish financial obligation. If you live in a state that does not require planning for college in the event of divorce, it is still advisable to have this conversation with your spouse. You do not want to be in a situation down the road where you are asking the other parent for support and have no recourse. You can have a legal document drawn up stating how and when you will contribute as well as what will happen to the savings procured if your child takes a gap year, doesn’t attend college, etc.
In addition, divorce can also impact financial aid eligibility for college students. When a college age student is filling out the Free Application for Federal Student Aid (FAFSA), only the custodial parent’s financial information is required to determine eligibility. If a 529 college savings plan is opened for a college student, it is important to note that it should be in the custodial parent’s name, otherwise it is counted differently and may lose up to half of its value. Additionally, if you are the custodial parent and remarry, your new partner’s income will be considered on FAFSA forms. It is important to take time and learn about the financial aid process, so you aren’t taken by surprise along the way.
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John Schutz
Partner at John F. Schutz, P.L.
Representing clients exclusively in family law cases for the past 24 years, Mr. Schutz is widely regarded as a marital and family law expert. He is Board Certified in marital and family law by The Florida Bar. As a Fellow of the American Academy of Matrimonial Lawyers (AAML), Mr. Schutz is committed to elevating the standards and improving the practice of family law.
Latest posts by John Schutz (see all)
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