- Firm Overview
- Practice Areas
- Family Law Victories
- Personal Injury Victories
- Info Center
First, if you create a college account for your grandchild and there is a later divorce, that account may be designated in the divorce judgment to be first used for payment of the child's college expenses, before the other spouse's obligation to pay college expenses kicks in. In fact, that spouse may get a free ride if there is enough in the child's account to fully pay for college.
Tip: Don't do an outright gift, if your child has divorce on the horizon, put college money for a grandchild in a trust drafted by a lawyer to give you or a successor trustee control over when and how money may be paid for educational or college expenses.
Second, if you have joint accounts with your child who later goes through divorce, it's possible that these funds may be claimed by their spouse to be marital funds to be divided in divorce. This is much more likely if your child has moved their money in or out of that account.
Tip: keep all the records necessary to trace the funds in the account to you.
Third, don't just give your child money, if your child is going through a divorce, and needs your financial help. Instead, if you expect repayment by their spouse, you need to have your child sign a promissory note or other document, each time money is given promising to repay that money as a loan. And your best bet would be to have their spouse sign too. You need to be aware that divorce judges many times do not see a loan from parents as real loan in the same way they view a loan taken out from the bank. Parents frequently give money to their children and don't expect repayment. Many times money to a child is given without repayment for years, so the judge concludes these payments were just gifts.
Tip: Don't give money directly to your son or daughter in divorce if you expect the other spouse to repay part or all of that money to you. Instead have your son or daughter to take out a loan at a bank even if you have to guarantee the loan, this will create a debt much more likely to be recognized by a divorce judge as a valid marital debt to be repaid by your child's spouse in whole or in part.
Contact an Illinois divorce lawyer at the Law Office of Martoccio & Martoccio if you are in need of family law assistance.
© 2020 Law Office of Martoccio & Martoccio 15 North Lincoln Street, Hinsdale, IL 60521 630-920-8855