The average cost of attending a private, four year college full time during the 2012-2013 school year was estimated by the College Board to be a whopping $43,289 annually. At $22,261, the average annual cost of attending a public college (in-state) is not much cheaper. The College Board has predicted that these costs will only continue to rise. Consequently, it is important that when going through the divorce process, you are prepared to discuss plans for college savings for the future, as well as the split, freezing, and/or disbursement of any college account(s) already in existence.
U.S. News suggests that if you already have set up a 529 plan account, you should freeze it so that during the negotiation process, withdrawals are limited to educational purposes for the child named on the account. Your divorce agreement should also delineate plans in the event that one or more savings accounts contain a balance once your child(ren) have graduated. The court may order that any existing plan be split between the parties, with each party responsible for maintain a new account with their mandated portion of the original amount.
If you have questions about property settlement agreement, please contact one of our attorneys for a consultation.