Paying for a child’s college education is a significant financial issue in any family, but with divorcing or divorced families, it can be especially tricky. Often times, if parents divorce when their children are young, the marital settlement agreement does not specify each parent’s obligation because that event is many years down the road. Therefore, when the time eventually arrives, planning for college should include not only traditional items such as exploring potential schools, financial aid packages, and travel and boarding arrangements, but also a review of the settlement agreement well before enrollment in a specific institution.
Is the issue reserved? The first item to evaluate is exactly what the language of the agreement specifies. While attorneys often speak in terms of “reserving” the issue, the meaning of the term is not always as clear as it would seem. If the language of the agreement states that the Court expressly reserves the issue of each party’s obligation to contribute to the college (or other similar language), neither party has a court-ordered obligation to pay for college. The parent seeking contribution to college expenses must file a petition with the court, and relief will be granted only back to the date of the filing of the petition.
Can retroactive contribution ever be achieved? If the agreement states that the parties shall pay for college based on their respective financial abilities (or other similar language), retroactive relief may be allowed because the agreement already contemplated that the parents would contribute to the college expenses. However, it is still advisable to file a petition as early as possible so that an order may be obtained prior to the child’s enrollment.
A child’s right to college expenses. If the agreement provides that each of the parties shall contribute to the college expenses of their child, the parties’ obligation to contribute to the expenses has already been ordered. Therefore, a child could also petition the court as a third party beneficiary to enforce the agreement.
It is clear that all college expenses provisions in marital settlement agreements are not created equal. Whether you are a parent preparing to begin the college search with your child or a professional giving a client advice, it is important that the exact language of the agreement be chosen carefully.