Separating couples with children — whether minors or young adults – have a lot to talk about during the divorce process. One of those topics should include college costs. Who will pay for your children’s education? Will each parent pay a specific share?
Any parent understands the importance of how education benefits their children. This is why divorce negotiations – whether in court, mediation or collaborative divorce – should address college costs, even when your children are young at the time of the divorce.
College costs continue to increase
Parents should expect college costs to be one of their greatest future expenses. They may be startled by the continuing escalation of higher education costs.
According to the National Center for Education Statistics, the average cost to attend a public in-state school in Michigan was nearly $23,400 for the 2018-19 school year. Private school costs are more than double that.
How much each parent pays, investing in 529 account
During divorce negotiations, here are some important points to address about college costs:
- Where the child attends college: Whether to attend a public in-state school, a public out-of-state school or a private school should be at the root of the discussion. This will help parents determine the costs and how much each can afford to pay.
- How much each parent will pay: Some parents may insist on an even split of the costs. However, it may be fairer that each parent’s payments are based on their individual incomes.
- Insist on investing in life insurance policies: Be prepared for hardship due to the death of one of the parents. If that happens before the child attends college, it is crucial to implement some type of safety net. Consider requiring each parent to have life insurance policies. Or, in the case of the inability to work, disability insurance. The funds from such policies could be reserved for that parent’s share of the college costs.
- Invest in a college savings account: Some parents are well prepared, opening 529 college savings accounts for their newborns and making regular investments. Even if you get a late start in creating such an account, it definitely will help pay college expenses. Each parent should consider opening and managing such an account.
Also, it would not hurt to look into financial aid, student loans and scholarships for your child. Any amount will help. But this is likely where you and your former spouse must work together to fill out the documents.
Work together, negotiate and agree
When it comes to the importance of your child’s education and how to pay for it, divorcing couples should set aside their differences and come to an agreement. Both of you love your child and want what is best for him or her. Work together, negotiate and agree.