Articles Tagged with college

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At the heart of many family law related disputes lie arguably the most difficult decisions regarding the children and their futures.  At times it may seem unlikely that individuals in the midst of a divorce will ever agree on anything; fortunately, ensuring that any children involved receive a quality education is usually a top priority for everyone.  Setting aside differences for what is in the children’s best interest saves not only time but may also preserve important financial resources that may be reallocated to ensuring the children’s futures are preserved. “Agreements” as they are so appropriately called, may avoid costly litigation procedures, and provide the parents with the opportunity to freely discuss, negotiate, and formulate what they mutually believe to be a plan that will best serve the interests of their children.

The freedom to contract is an important legal principle and when utilized correctly, can be both an effective and efficient means of resolving issues. A recent North Carolina Court of Appeals case, New v. New, discusses the implications and consequences where parents utilize this right to resolve how to care for their child as they confront arguably the biggest step of any child’s life: attending college. In New, the parties agreed to pay off their children’s “ordinary and necessary” college expenses. When it came time to pay up, “ordinary and necessary” became a point of contention.  Language in any agreement is crucial, and given the general stance that parties are free to negotiate how they see fit, it is imperative that any ambiguities are either understood and accepted or limited and clarified during formation.  Here, the parties initially worked together, saving time and money in coming to an agreement, only to end up right back in a courtroom, litigating a language based issue that could have been potentially resolved at negotiations.

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Dear Carolyn,

My daughter just graduated from high school, and she is college bound.  Her father and I divorced three years ago.  Her father paid child support, but I understand child support is ending now as she is already 18.  I thought her father would surely pay (or at least help) with college, and he told me last night that he was not helping with college.  What can I do?  Our divorce agreement says NOTHING about college.

~ College Help Needed


Dear College Help Needed,

This is a most difficult situation for you and for your daughter.  Unfortunately, in this State, parents have no legal obligation for support after the child is 18 and out of high school.  Other States are different.  For example, in Alabama, the divorce court can order college if the child’s lifestyle and economic status would indicate that the parent would have paid for college in an intact family.  Also, in Massachusetts, as another example, child support continues to age 21.

The only way a parent can be bound to pay for college is in a private agreement.  At the time of your divorce settlement, the father and you could have entered into a private agreement, signed and notarized, that describes how the child’s college costs will be handled.  If you had such an agreement, the agreement would be enforceable by you.  Frequently, college is difficult to negotiate because Father’s feel that the child will “snub her nose” at the father if college is guaranteed by a contract.  You do not say anything about the daughter’s relationship with the father, and whether it is a close, loving relationship.

If the child’s financial aid application requires the father’s income, sometimes it is helpful to have a letter to accompany the financial aid application stating that the father will not participate in college expenses.  I have written several letters like this in the past for clients who have no expectation from a parent of college participation.

Good luck with college for your daughter, and congratulations on her high school graduation. Continue reading →

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Question: I am a mother from Summerfield.  I have been saving for my children’s college, but I am now faced with divorce. My ex-spouse is the owner of the 529 Plan.  What happens to the 529 Plan in my divorce?

Answer:   While the intent of the 529 Plan is to provide college funding for your children, you may find it in the fray of a divorce settlement.  If you make contributions to a 529 Plan during the marriage, then the account value of the 529 Plan is part of that marital estate for the division.  What can you do to preserve the 529 Plan for the children in the divorce settlement?

You need to educate yourself on your 529 Plan and how it fits into your North Carolina equitable distribution.  In a high net worth divorce, there are risks that your child will not end up as the Beneficiary of the college funds unless you take the appropriate action.  Here are some key points you need to understand:

The maximum amount you can add to the 529 Plan is $410,000; The minimum contribution is $25. Continue reading →