Saving for a child’s college tuition needs is a goal that many families have. Unless certain planning steps are taken, sometimes, those funds are put into the general family savings pot. During a divorce, other financial needs may take precedence. In Texas, college funding may become part of the general child support conversation, and the parents will decide how to plan for the future.
In the aftermath of the divorce, each party will need to adjust their financial situation. Marital property will be divided among the two, and each parent will need to participate in the discussion about how to take care of the children. When two households are being supported instead of just one, one’s plans about which college that child may attend might have to be adjusted. Public schools and scholarship programs may become the preferred plan since basic housing and other needs must first be met.
Some families start a 529 college savings plan. These funds can be accumulated tax-free as long as they are used for qualifying educational needs. Since 529 savings funds are already earmarked for college, they may be less likely to be divided during a divorce.
Depending on an individual’s financial situation and background, he or she may work with the co-parent to determine a child support plan that will include college and possibly graduate school. In Texas, some individuals may need to look outside the family for more guidance on this issue. A knowledgeable family law attorney can offer help determining the plan that meets your child’s best interests.
Source: CNBC, “How to keep your divorce from sabotaging your children’s college education“, Lorie Konish, May 18, 2018
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