One of the toughest things about divorce is untangling and dividing finances, and planning and making financial agreements for the future that each party can live up to when kids are involved. Fortunately, my ex-wife and I have done a pretty good job at that, and it’s paying off now.
Money battles between divorced parents and short-sightedness not only cause intense acrimony between the former husband and wife, but almost unavoidably will spill over into relationships between the parents and the kids and cause more turmoil, stress and anxiety. Challenging enough that parents who once combined incomes to create more buying power and economies of scale have to double down on everything after divorce – housing, property taxes, furniture, electricity, cable, maintenance costs, health and car insurance and more – without negatively affecting relationships and kids’ attitudes, perceptions and sense of well-being and security.
My ex-wife and I are likely going through our greatest time of financial stress since our separation 11 years ago right now, yet we are weathering it well (I can’t be positive, but I think I can speak for both of us). This fall 2016, both our children will be in college at the same time. In addition, I am in a graduate school program for counseling, so I’ll be paying for three higher education degrees simultaneously.
But a few things have saved us from potentially extreme financial pressures and enormous debt.
First, we planned for the kids’ college education early in their lives, investing in Maryland’s prepaid college tuition program (for two years’ tuition) when they were 4 and 2. We also opened Education IRAs for each child around the same time. Second, when we divorced, we agreed to continue contributing to each fund on an arranged schedule, and each of us adhered to the agreement. Third, I opened Maryland 529 college investment accounts for me and both kids a few years before my oldest entered college to help fund my education and fill in inevitable gaps in theirs. Finally, each kid made wise choices to attend state universities, where tuition costs are half or less of private or out-of-state colleges.
My ex-wife and I each have had the discipline, cooperation and foresight to keep contributing to the kids’ college educations, even though we were no longer united or in agreement on other things. Sending both kids to college still will make a big dent in my monthly budget and annual cash flow. But as a result of our advanced planning and divorce agreements, I believe each kid will be able to graduate from college debt-free (and me from my graduate program without wiping out savings and investments). That will be a huge gift to each of them, and a big benefit in starting out their adult lives.
Working together with an ex-spouse after a divorce, as aggravating and imperfect as it may be at times, certainly pays off, both for the kids and the adults going their own ways.