For some couples, one of the silver linings of being divorced is not having to discuss (or argue about) money any longer. If you’re co-parenting children, however, you have some more years of joint financial decisions ahead of you.
You can make things easier by detailing as much as possible about these financial aspects in your parenting plan and other divorce agreements. Let’s look at some examples.
How will you keep track of payments and reimbursements?
There are a number of co-parenting apps that make it easy for parents to document expenses like medical bills, school supplies, extracurricular activities and more. You can also transfer money on some of them. This can help you manage expenses without much communication. Of course, the clearer the responsibilities for expenses are detailed in advance, the less confusion and conflict you’ll have.
Who claims the children as dependents for tax purposes?
If you’re sharing custody of one child equally, you may find it beneficial to take turns claiming them as a dependent each year. If you have two or more, you can each claim at least one. It may be more beneficial for one parent to claim them than the other. These are things you should discuss with a tax professional.
How are you paying for college?
A divorce shouldn’t mean the end of your children’s college funds or their goals of going to a particular school. Determine whether you will both contribute to a 529 or other savings account and how much you’re able and willing to cover financially regarding your children’s education.
Who’s helping your kids with their savings?
It’s important for children to become financially literate and understand the connection between earning and saving money and buying things. When they’re old enough, who will help the kids open their own savings accounts? Will both of you pay allowances? These are things to consider.
The kids don’t need to know the details, but should understand that both parents contribute financially toward their well-being. That can help them become confident and well-rounded young adults.