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Divorce ~ Paying for College

Unlike most states, New Jersey family courts have the authority to require divorced and separated parents to contribute to their children’s college expenses. When negotiating custody and marital settlement agreements, parents should consider whether, and at what point, they will address college expenses and how those costs will affect child support. Children who go away to college still need clothing, sundries, and a roof over their heads when they come home from school. For couples with very young children, agreements often do not spell out these obligations, because each party’s financial circumstances are likely to change by the time children are applying to college. Still, those agreements can indicate that the parties recognize that their children may attend college and that they will address the issue when each child is in his or her junior or senior year of high school. Those parents might include provisions in their agreements to set aside assets for college or to require that they contribute to college savings over time. For older children, particularly teenagers, parents should be prepared to discuss and lay out the details for handling their children’s higher education as part of their divorce agreements.

Parties must decide which college costs they will pay, i.e., tuition, room and board, books, transportation, dorm room set-up, laptops, spending money. Should the parental contributions be limited or capped? Will the child be expected to take loans, apply for financial aid or otherwise contribute? How will paying for college affect child support?

Child support pursuant to the New Jersey Child Support Guidelines usually ends when a child reaches age 18 and graduates from high school. We all know that this does not mean that children are self-sufficient or that parents no longer have any responsibility to support their children; rather, it means that the guidelines no longer apply, thereby requiring a case-by-case analysis of the child’s needs, the anticipated college costs, and the ability of parents to provide shelter, and help cover transportation and personal expenses that do not specifically fall under the definition of college expenses. In this way, parents address the continuing need for child support taking into consideration their anticipated contributions to college costs, not only for children who live away at school, but also for children who live at home and commute to classes. Although college costs are substantially lower when a child lives at home, the at-home costs for food and shelter remain significant and there are still college expenses to pay for tuition, books, computer/electronics, school fees, parking permits and transportation. Thus, college expenses and child support are related and should be determined in relation to each other.

When judges decide parents’ responsibility for college, they must consider at least twelve factors concerning a family’s circumstances to establish whether, and to what extent, each parent will contribute. Some of these factors are:

• Financial capability of each parent
• The cost of the proposed college education
• Financial aid available to the child via scholarships, grants, loans and work study
• Whether the child has the ability and the commitment to attend college
• The child’s relationship with the parents
• The child’s financial assets

Whether parties are litigating the issue or settling it through mediation or collaborative family law, they will be considering the same factors that the court would consider, examining their options and exchanging proposals for handling the financial realities of sending children to college.