When relationships end, things can get messy, even when the end is amicable. And they can get more complicated when there are children involved. On top of the time, effort and emotional toll of raising a child, there are also finances: Children are expensive. That’s where child support comes in to try to solve the issue. But how much is child support and how is it determined? Here’s how it’s defined, how it’s calculated and how much you can expect to get.
A financial advisor can help you create a financial plan to pay for your children’s needs and goals.
What Is Child Support?
Child support is a regular payment a parent makes to provide financially for a child after the end of a relationship or marriage. With child support, one parent is paying the other explicitly for the costs of raising their child. Laws on the size of this payment vary state-to-state. Typically, child support is paid by a noncustodial parent. Though, in some scenarios with joint custody, one parent may still be required to pay child support.
Origins of Child Support in the U.S.
Child support started as a federal government welfare initiative in 1935 with the Aid to Families with Dependent Children program, which was part of the Social Security Act. This program provided for low-income families to raise children until it was phased out in 1997.
In 1975, the Office of Child Support Enforcement (OCSE) was created to reduce child welfare payments and require parents to provide for their offspring. Today, the OCSE requires states to set up their own enforcement agencies and provides assistance to these state-run agencies.
How Is Child Support Calculated?
So, how much is child support? Well, that depends on a variety of factors. Income, location and whether you’re a custodial parent all play a large role in determining how much child support you pay. Ultimately, a court is going to decide how much your child support is. But they may employ one of these three models to inform their decision.
Income Shares Model
The income shares model requires both the custodial and non-custodial parents pay for child expenses at the same rate they did when their relationship was still intact. Essentially, it wants the kids to have the same standard of living as they did before the split. It considers the costs first, then splits them proportionally across the two incomes.
Specifically, this model determines and combines the income of parents, then calculates the child support obligation based on a statutory table or schedule, considers additional child support and medical expenses, and finally prorates the child support obligation between the parents based on a percentage of the combined income.
Of the three models, this one is the most popular, with most states basing their child support guidelines on it.
Percentage of Income Model
The percentage of income model differs from the income shares model in that it considers only the income of the non-custodial parent. The custodial parent’s income isn’t considered, as it’s assumed that it is mostly spent on raising the child. Each of the six states (Alaska, Mississippi, Nevada, North Dakota, Texas, Wisconsin) that use this model has a different table to determine the percentage of income the non-custodial parent pays.
The Melson Formula is a more complicated version of the income shares model. Along with calculating the financial needs of raising the child (as in the income shares model), the Melson formula tries to account for the needs of the parents as well. The formula was developed by Delaware and is currently only used by Delaware, Hawaii and Montana.
How Much Is Child Support By State?
So, now that we’ve covered how child support is calculated, how much does it cost by state? The truth is there are too many factors to consider to give you a reliable number for your situation. But, to demonstrate how different states can be with enforcing child support, let’s walk through an example using Virginia and Massachusetts. Both states use the income shares model and estimates are based on the corresponding state child support calculators linked below.
For this example, both you and your co-parent have a gross monthly income of $4,000 and have two children, each of whom do not live with you. To keep things simple, we also won’t factor in costs like health insurance and childcare. In Virginia, you would pay an estimated $712 a month. In Massachusetts, it’s estimated you’d pay $1,164 a month, or more considering that the children don’t live with you at all. That’s a difference of over $400 a month between the two.
How much is child support? The answer is that really depends. Income and the state you live in factor heavily into how much child support you pay or receive. The goal of most states is to maintain the same lifestyle for the child as they had before their parents’ relationship ended. This child support payment will help the custodial parent cover the costs of basic needs, like food, shelter and healthcare.
States employ different models to try to strike a fair balance. Some are more successful than others. Keep in mind that where you file for child support matters, especially if parents are in different states. Also, if you haven’t already, consider consulting a lawyer for all matters around divorce, custody and child support.
Tips to Plan Your Family’s Finances
- Whether you’re paying or receiving child support, working with a financial advisor can help you create a financial plan to pay for the cost of raising your children. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- Children benefit from financial security. Tools including 529 Plans, UTMA accounts and life insurance can add a layer of stability. When you die, life insurance provides a lump sum to your heirs to cover expenses and make up for your lost income. Use our life insurance calculator to determine how much coverage you may need.
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