For many New Jersey parents, paying for their children’s higher education can be a major source of stress. The College Board estimates that the already-high costs of university education rise by around 3 percent every year. The sum is already substantial, especially when multiplied over the course of four years; every year at a private university costs approximately $46,950 when tuition, fees and room and board are taken into account an a year at a public university costs an average of $20,770. However, many parents are committed to making a substantial commitment to their children’s university education.
Planning to deal with educational costs can be particularly complicated when parents decide to divorce. The costs of divorce, including setting up two households, dealing with asset division and prioritizing child support and spousal support, can place a significant strain on parental finances, including plans for a child’s education. While married couples may think about saving for their children’s education, few have a financial plan as to what to do in the case of divorce or widowhood.
Many parents use specialized savings plans like 529 accounts to save for their children’s college funds. A 529 plan allows parents to save and withdraw tax-free so long as the funds are used for a verified educational purpose. It can be particularly important to plan out how to handle existing 529 accounts during a divorce; in some cases, the account may be split into two under the custody of each parent, while in other cases, the parents may share control of the account for the benefit of their child’s education.
Higher education expenses are just one of the financial matters that can be handled during divorce negotiations and the settlement process. A family law attorney might be able to help a divorcing parent to achieve a fair settlement on a number of issues, including property division, child custody and spousal support.