You and your co-parent need to handle your child’s expenses. Examples of the types of expenses you will share include personal care, education, medical care, extracurricular activities, transportation, electronics and miscellaneous other things.
These may include clothing, toiletries, babysitter, daycare, tuition, school supplies, medical equipment, prescription drugs, sports equipment, musical instruments, dance classes, bus fare, a teenager’s car costs, cell phones and emergency funds.
You should first agree on what is a necessary shared expense and create a list. Then, discuss how to split them. Co-parents use different methods for splitting shared expenses, including:
The pro rata method
The pro rata split divides shared expenses proportionally based on each parent’s income. Instead of a 50/50 split, the combined income of both parents is first considered. For example, if parent A earns $60,000 and parent B earns $40,000, the combined household income is $100,000.
A percentage is then determined using this formula: (Individual income/combined income) ×100. This means the percentage for parent A will be ($60,000 ÷ $100,000) ×100 = 60%, and for parent B will be ($40,000 ÷ $100,000) ×100 = 40%.
So, if a shared expense costs $500, parent A will contribute $300, and parent B will contribute $200.
The category method
This involves assigning specific types of expenses to each parent. For instance, parent A handles education and personal care, while parent B handles healthcare and extracurricular activities. Each parent is responsible for ensuring the expenses under their category are paid and for tracking those expenses.
The reimbursement method
This is when one parent pays for a shared expense individually and invoices the other for their agreed-upon portion.
The pro-rata split works well in amicable co-parenting, the category method is flexible and the reimbursement method benefits high-conflict co-parenting relationships. Regardless of the method you use, it helps to embrace technology and professional guidance to ensure your child always has what they need.