Regardless of whether your children are young, just starting high school, or embarking on their collegiate journey, the subject of college tuition needs to be addressed in New York divorce cases. Higher education is a costly necessity, and even with scholarships, grants, student loans, or other forms of financial aid, it is a good idea to have some money set aside to help cover tuition, room and board, and living expenses. Because of this, it is important to have a stipulation in your divorce settlement that outlines each parent’s financial obligation when it comes to your child’s varying college costs.
States do not require parents to pay for their children’s college tuition, however, they do recognize how valuable higher education is, which is why courts encourage divorcing parents to agree on financing before a divorce decree is issued. Some couples opt to pay different percentages of their children’s college tuition based on which parent has primary custody. For instance, a non-custodial parent will agree to pay 75% of college costs and fees in lieu of paying higher weekly or monthly amounts in child support or alimony. Sometimes couples will agree to pay the total sum of their children’s undergraduate education, while others will agree to pay only the remaining amount after scholarships and grants are subtracted from the annual tuition. Of course, this all depends on the financial stability of both parents, as well as which school the child decides to enroll in.
New York State divorce cases will often apply a SUNY Cap while determining each parties’ financial obligation to their children’s higher education. Simply put, a SUNY Cap allows divorcing parents to put a limit on how much money they are each required to pay for their children’s tuition costs. Parties to a matrimonial action are allowed to limit their financial obligation to only the costs associated with State University of New York schools. This means that if their children opt to attend either a private university or an out-of-state institution, the parent’s will only have to pay a portion of the tuition, which is usually based on how much a public college or university within the SUNY system charges. The limited percentage of the parent’s obligation helps to soften the financial burden of footing a university tuition bill, which is incredibly helpful if more than one child plans to attend college.
Another way that divorcing parents can address the issue of future college costs is to open a New York 529 College Savings Plan. The plan allows parents, grandparents, and other family members to contribute money to a college fund, that in turn, will be invested. The idea behind the 529 Plan is that by the time the child has graduate high school and is ready to enroll in a qualified higher education program, the original value of the account will have increased due to successful investments. There are many benefits to opening a 529 Plan, such as low fees and tax benefits. Divorcing parents can opt to each deposit a lump sum prior to their divorce decree being issued, or alternatively, they can make monthly, quarterly or annual deposits into the account. A joint college savings plan is a great alternative to a SUNY Cap agreement and stipulation, especially for parents of multiple children or varied incomes.
Divorce with children is a very complicated and delicate matter, which is why it is imperative that both parties retain experienced legal counsel. A NYC matrimonial and family law attorney who specializes in complex legal actions will be able draw from their experience and help develop a plan that best fits your particular situation. The law firm of Brian D. Perskin & Associate, P.C., is comprised of dedicated attorneys who focus their practice solely on New York divorce and family law. Contact the staff at 718-875-7584 or 646-759-9392 to schedule your free consultation today.