What You Should Consider When Mediating College Expenses – Part 2

What You Should Consider When Mediating College Expenses – Part 2
June 21, 2017

{3:18 minutes to read} In Part 1 of this series, we looked at parental considerations in relation to a child’s college education. In Part 2, we will define typical college expenses and look at limits on what a parent will contribute.

How do you define “college expenses?

Is it just tuition, room and board, or do you want to consider other typical expenses that will be due?

In addition to tuition and room and board, most parents include a provision to share:

  • Required books, materials and supplies;
  • Laboratory, library, student and athletic fees and equipment;
  • A computer and printer;
  • Off campus housing;
  • University and activity fees; and
  • Reasonable transportation expenses.

Will you pay any expenses related to college applications or testing?

How do you pay for SAT courses, college applications and visiting colleges?

Most parents agree to share in application and testing fees, including SAT related courses. They may also agree to share the costs for visiting colleges, but with a limit as to how many colleges will be visited.

Should there be a limitation on how much a parent would be required to pay (a SUNY cap?)

Do you think that, no matter the cost, you are willing to pay for the school that your child seeks to attend?

Whether the child attends a State University of New York University (SUNY) or a private school, parents may want to limit responsibility to the charges at a SUNY school at the time the child enters college, in addition to the other fees defined as college expenses. You should also research and specify the exact SUNY college that will be used as the measure.

How to apply money already saved?

Does only one of you get a “credit” for college money provided by that person’s parents?

Typically, the amount to be paid by the parents and possibly the child would be the amount remaining after the application of all college savings, financial aid and scholarships. Sometimes, though, parents may agree that if a gift came from one parent’s family, then that parent gets credit for it.
Most parents would consider that any funds saved before the separation, including gifts from either family, would serve to reduce the overall college expense thereby benefitting both parties.
On the other hand, monies that a parent saves after the separation are typically applied against that party’s required contribution only, so be sure that after the separation you start new 529 accounts for your individual contributions.

 

In the final post of this series, we will discuss the child’s role with regard to their college education and any credits against child support.

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