Weathering the Storm: Divorce & Financial Aid

What happens when parents are getting a divorce, but financial aid for their dependent child has yet to be processed for the next school term?  Even amidst parental separation, it often requires a student to itemize their income along with the custodial parent on the joint income tax return.  If you’re in this situation, it’s important to find out how divorce as well as separation can affect your student.

Filling out the FAFSA after Divorce
For students who are not filing as independent on the FAFSA, divorce and financial aid go hand-in-hand.  When a student’s parents are divorced or separated, the custodial parent completes the FAFSA.  When there is a stepparent (if the custodial parent remarries), his or her income must be included.  Those with joint custody and equal time divided between each parent should focus on the parent with the lower income.

Additionally, a number of schools also require the noncustodial parent’s income via the Noncustodial PROFILE Application.  Check with your school to determine the requirements for divorce and financial aid.  They will likely require a copy of the divorce decree or separation papers because the contractual language may specify how the income and assets will be split.

What if the Parents Aren’t Helping Pay for School?
After a divorce, some parents may be reluctant or flat out refuse to file financial aid forms or help with college costs.  They may feel their responsibility ends with the divorce or that they can no longer afford it.  A parent who helps with college costs, even when it is a struggle, should be commended.  The government and colleges feel it is the parent’s responsibility and count the income and assets of parents, regardless of whether or not a parent is planning to assist with school funding.

Even if parents refuse to pay, the school and government will consider their resources when determining a student’s eligibility and the student will have to make up the difference.  Unfortunately, studies show that only “29 percent of children with divorced parents get parental support for college expenses, compared with 88 percent of children from intact families”.

What if the Student is Getting Divorced?
A student’s marital status at the time he or she completes the FAFSA will determine whether or not a spouse’s (or parent’s) income will be considered.  Since a separation doesn’t actually dissolve a marriage, a separated student is still considered married when being considered for dependency status.  Answer “Yes” where it asks “As of today, are you married?” if this is the case.

Divorce inherently adds complication to your life, and financial aid is no exception.  Arm yourself with knowledge on how to properly handle the admissions process, whether divorce is imminent or long passed.

Westface College Planning can help navigate the financial aid process from start to finish, even during summer!  To learn how we can help you call us at 650-587-1559 or sign up for one of our Tackling the Runaway Costs of College Workshops or Webinars.

_{Photo Credit: Patrick Emerson}