When parents get divorced, child support ensures that both parents contribute financially to the care of their children. Child support payments can be negotiated between parents, but the courts step in when they cannot agree on the right amount. Here’s a breakdown of what child support is used for, who gets it and what restrictions apply. You can also work with a financial advisor to prepare your finances to either pay child support or to make sure the child support you receive goes to helping your child with qualified expenses.
What Is Child Support?
Child support ensures that both parents contribute to the financial support of their children by forcing the ex-spouse who doesn’t have custody to provide financial help. Even if one parent doesn’t want to be personally involved with their children’s lives, they still can be forced to contribute to the expenses of raising their child. Not paying court-mandated child support can cause fines and even jail time.
How Is Child Support Determined?
The rules for child support payments vary by state, but the general rule is that the child should be treated relatively the same as if the parents weren’t divorced. Many states offer calculators or guidelines that help to determine child support. Because of that, it is best to speak with a divorce attorney in your state to determine what rules apply to your situation.
Child support payments are typically based on the basic needs of a child and each parent’s income. Over time, if one parent’s income changes significantly, either parent can petition the court to increase or decrease child support payments accordingly.
Who Gets Child Support?
In most states, children receive child support until they turn 18 years old or until they graduate high school. Additionally, if the child goes to college, parents may be required to continue child support payments until they graduate from college or graduate school. Child support payments are made to the other parent. However, child support money is the child’s right, and the money should be used to cover their expenses.
What Can Child Support Be Used For?
Raising a child can be expensive, and there are many different costs that parents need to cover. Child support payments are typically used to cover basic needs, health care, child care, tuition or other expenses. Here are a few of the most common expenses for each category:
- Basic Needs: Food, clothing, housing and transportation.
- Health Care: Medical, dental and vision insurance. Co-pays and deductibles, braces, over-the-counter medicines and hygiene.
- Child Care: Daycare, before and after school care and summer camps.
- Tuition: Children may attend a private school for religious or educational reasons. Some states also require child support to help cover the costs of attending college or graduate school through tuition payments or 529 Plans.
- Other Expenses: Extracurricular activities, tutoring, uniforms or instrument costs and extraordinary healthcare costs.
Are There Restrictions On How You Can Spend Child Support?
Generally, the receiving parent isn’t required to keep track of how they spend child support payments. Once the money is received, it is usually commingled with other money in their bank accounts. Because of that, it is nearly impossible to distinguish which money is being used for what expenses.
However, if the parent paying for child support can determine that the child’s needs are being neglected while the receiving parent is spending money on themselves, they could appeal to the court. The court won’t get involved in petty disagreements. But, they will investigate if it is obvious that the child’s needs aren’t being met. In these situations, the court may require the receiving parent to document how money is being spent to care for the child.
The Bottom Line
Child support payments are a legal obligation to take care of a child’s needs when parents get divorced. These payments typically must be made until the child turns 18 or graduates from high school. However, they may continue through their college education. The money should be spent on the child’s needs, but there generally isn’t a requirement to document how money is being used. Consult with your financial advisor and attorney on how to approach your financial obligations if you’re going through a divorce.
Tips for Family Financial Planning
- Working with a financial planner can help you meet your financial obligations to your children, while also saving for your own future. You can discuss your goals with your financial advisor to determine the best strategy for your situation. If you don’t have one, finding an advisor doesn’t have to be difficult. 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.
- When you have children, there are many ways to take care of your children financially, including 529 Plans, UTMA accounts and life insurance. Life insurance provides a lump sum to your heirs when you pass away to replace your income and cover expenses. Use our life insurance calculator to determine how much coverage you may need.
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