Do you have children who will be going to college in a few years, or maybe a decade from now? When you and your spouse are together, you likely have been saving for college or have at least started to make some plans for the future education of your children. However, you might be wondering what happens when you get a divorce? In those cases, who will be responsible for paying college expenses after divorce?
What Does the Law Say?
The laws can vary from one state to the next. In Arizona, the legal rules do not set out a specific course of action. It’s not uncommon for parents to negotiate who will be responsible for college expenses after a divorce. It’s important to realize that child support and paying for college are two separate things entirely.
This type of issue is not often litigated at trial. Typically, it would only happen if the child is a minor. For example, parents of a gifted child that enters college early might need to take things to court. Keep in mind that the court’s ruling will only apply until the child turns 18 years old. The ruling can only extend until the child becomes emancipated.
When divorcing parents enter into an agreement related to college expenses, they are essentially entering into a contract. What does this mean for you? It means the obligation to perform, in this case to pay for college, would arise from contract law and not from the law that governs child support.
Due to the contractual nature of college tuition, it means that the nonpaying parent does not have standing to sue in the event the responsible parent fails to pay. Instead, the child, who is the beneficiary of the contract, would be the one who has to sue if the contractually obligated parent does not pay.
Of course, this can create quite a few problems when it comes to the dynamic between the parents and the child. Because of this, these types of lawsuits tend to be rare.
What Should the Nonpaying Parent Do?
If you are the nonpaying parent, and your goal is to make sure that your child has their college expenses paid for by the other parent, you need to be wary of any blanket contract language that you and your ex initially agree to. It could come back to haunt you. Of course, this doesn’t mean that you don’t have any options for ensuring your child has an education.
Even though your ex might claim that they will take care of the expenses when they arise, you can’t rely on this. There could be any number of issues that crop up that would render it impossible for them to pay. They could lose their job or their business. They could become injured and unable to work, which would mean their funds would be more limited. You might also have an ex that says one thing but never follows through, even when it is for the children.
Additionally, you can’t expect that your children will get all of the grants, scholarships, or even the loans that they need for schooling. There are many factors at play when it comes to college expenses after divorce, and your children getting an expensive loan could end up putting your child into their own debt for years. If you or your ex gets a loan for them, it simply means more debt for either one of you.
You can’t have faith or hope that things will be okay since you can’t predict the future. What you can do is better prepare for the future by getting things taken care of right now. Let’s look at an example.
Communication is important. Your ex likely wants your child to have a good education, just like you do. Talk with them about the options and their plans to get a sense of what you can do to put money toward the education without going into a contract of any sort. The example below is one of the best options if you have the assets for it.
Create a Trust for Your Child’s Education
You and your ex could agree to take a portion of the marital assets that you have accumulated and then put them into a carefully drafted trust that is specifically for your child’s education. When you put money into a trust, it will ensure that neither you nor your ex can touch the money. It also means that the funds will be there and available for when your child needs them.
This can help to put your mind at ease since it will entirely avoid the issue of nonpayment. You and your ex will not have to worry about the future expenses and the fights that could later ensue. Your child will not have to worry about paying for their college. Getting everything taken care of early like this will be a huge weight off everyone’s shoulders.
Of course, there are other options, as well. You could start to save more for your children’s education on your own just in case the parent who is supposed to pay doesn’t follow through, for example. If the other parent does pay for part or all of the education, then you can use that money for something else.
Do You Like the Idea of Setting Up a Trust?
If you feel that putting part of the marital assets into a trust for your child’s education and college expenses after divorce is the best option, you will want to get some help from an attorney. However, you should make sure that the lawyer is well-versed in both family law and trust law. This will help to ensure that the process happens smoothly and without any issue.
Take the time to speak with an attorney and discuss the available options. They can help you to determine how much of the marital assets should be put into the trust and can walk you through everything that you need to do.