Every state and the District of Columbia oblige parents to share financial responsibility for their children after divorce. The specifics of each settlement will vary according to each family’s circumstances and financial abilities.
At a minimum, state laws demand that child support cover the basic needs of a child: food, shelter, clothing, medical expenses, and certain educational costs. However, children often require financial support beyond their basic needs. Divorcing parents should consider these supplemental costs and ensure that they’re covered in an out-of-court settlement.
Child-Related Costs When Divorcing
When creating a divorce settlement, many divorcing couples underestimate how much they can think outside the box and use creative solutions to resolve tricky problems. Here are three issues to consider when planning for your child’s post-divorce financial future, and creative ideas for approaching each one.
Many children are involved in extra-curricular activities that contribute to their talents, skills, and well-being. Some parents consider these activities to be as essential as their general education, but they can be pricey. You have numerous options for dealing with these costs, including:
- factoring in extra-curricular costs into your overall monthly child support payments.
- agreeing that each parent will be responsible for the costs of a specific activity. For example, one parent would pay for piano lessons, while the other would pay for a gymnastics course.
- setting up a fund with a specified amount exclusively intended to cover the cost of extra-curricular activities. The money can be shifted into a designated bank account as needed.
To keep the agreement fairly balanced, parents should be able to adjust the terms as needed to account for a child dropping or adding activities.
Most states obligate parents to support their children until age 18. However, if you want or expect your child to attend college, you should factor these costs into your divorce settlement, even if your children are very young. You may agree that each parent will make an annual pre-decided contribution to a college savings fund. This will be according to your respective financial abilities until your child graduates from high school.
If your child is close to college age, you may want to draw up an agreement that establishes how the two of you intend to handle these expenses. College-related costs include tuition, books, living expenses, transportation, and more. The settlement should also cover issues such as which parent will have control over the college funds, where the money will come from, and what happens if the child takes a gap year or takes longer than expected to attain their degree. A certified divorce financial analyst can be instrumental in helping you come up with a feasible plan.
The only thing constant about life is change. Unexpected child-related costs can arise after the divorce is final. For example, if you or your child must stay in the hospital for a prolonged period, this can result in a myriad of unexpected costs. Such costs could include medical bills, child care, transportation, and more. Other unforeseen expenses may include child therapy, tutors, or specialized education to meet a particular need. You won’t be able to anticipate every contingency. Your divorce settlement should discuss the approach you and your ex will generally take with respect to unexpected expenses. It is important to consider how you can fairly share in the costs. Also, keep in mind what to do if you disagree on a course of action.
Divorce doesn’t have to be the knock-down, drag-out fight often portrayed in movies. You and your ex-spouse can come up with creative, amicable solutions that feel fair to both of you. If you’re considering divorce and would like to develop a creative divorce settlement that might mean a brighter future, contact my team at Miller Law Group to schedule a confidential consultation.