It’s important to clarify how shared expenses for children will be paid for by each parent, and that the expenses are split according to the percentage of total income of both parents. Specifically, unless both parents’ incomes are equal, a 50/50 split of expenses is not reasonable. As an example, if one parent’s income is $160K and the other parent’s income after spousal support and child support is $60K, then a 50/50 split of shared expenses is not reasonable and has a negative impact on the children’s lifestyle when they’re with the parent who has to share the expenses equally on less income. I see this issue often in my practice, and also in my own life.
This happened most recently to me regarding a hospital bill for my son. My Ex has remarried, and his wife has a daughter from a previous marriage. In my divorce, my Ex was tasked with carrying our children on his health insurance because he had the higher income. Per the usual, the Order states that we’re to use in-network providers and share the costs 50/50. The Order does not address how the deductible is to be paid. The Order also states that shared expenses are not to exceed $300 and are due 30 days after receipt.
Last Spring, my son became extremely ill during an out-of-state trip with his Dad and required ambulance transport to a children’s hospital for his care and possible surgery. The ambulance bill was expensive, but I happily reimbursed half because I was so glad my son recovered without surgery. The bill for the doctor came a couple of months later, and I happily reimbursed my half for the same reason. The bill for the hospital came 8 months later as justification for my Ex not having sent me his reimbursements for four months. This bill was shockingly large, and I was unable to reimburse this immediately, especially after covering the kids’ expenses for months with no reimbursements from him. I let him know I needed time to pay half of that bill. So, this month, my Ex didn’t send his child support payment, to cover my portion of the hospital bill. Poke the bear, and she’ll come out growling.
I reminded him that there’s a Court Order in place stating child support is to be paid by the 1st of every month. I reminded him that shared expenses are separate from child support payments. I let him know that our son has outgrown all of his pants, and I was counting on that child support payment to take him shopping this weekend. My Ex still didn’t send the child support payment, and I’ll still need to take my son shopping this weekend. So just now, I sent him an email disputing that medical bill. It’s important to have these conversations by email, for use in later legal action. Predictably, my Ex’s response began with, “Take me to court, then.” This year, I signed up for a prepaid legal plan specifically in anticipation of having to enforce one of the various Orders in place—there hasn’t been a single year since the divorce that I haven’t had legal expenses from dealing with my Ex’s refusal to follow the Orders.
In my email disputing the medical bill, I let him know that I won’t pay the deductible on his health insurance plan because I won’t pay for any portion of his or his wife’s medical expenses. To resolve the dispute, I asked him to send me documentation showing that the amount he’s requesting I reimburse does not include any portion of his deductible. I let him know that I would only reimburse the deductible once he sent documentation proving his wife and her daughter were not covered on his insurance plan, and/or there was still a portion of the deductible left after all of his and her medical expenses for the year had been considered. I wish I’d had the foresight to have these exclusions written into the Order. I wish either his attorney, my attorney or the Arbitrator had thought to write them in. Not having done so, the only way to resolve these disagreements is with further legal action, which takes resources away from the life I’ve built for myself and for my children.
In my practice, I review all financial proposals for my clients. I use my knowledge as a Certified Divorce Financial Analyst, a Financial Advisor and my own life’s experience as I’m thinking through the financial impact to my clients of each point of negotiation. Risk analysis is a critical component of every financial plan I write, and I review proposals from this lens. At this point in my practice, the most recent surprise I’ve seen in a case was finding evidence of an offshore account during an asset tracing. (That’s a story for another post, but it was fun hearing the attorney’s rendition of the opposing side’s reaction when she brought up THAT little tidbit…) It’s important to get a financial expert’s opinion before you agree to anything in your divorce. I don’t charge for consults, and I’m happy to meet with you and explore your circumstances and discuss how I can help you. Schedule a time for us to talk here.