Managing Child Support Payments

No matter how you look at it, raising kids is expensive. From toys and extracurriculars to housing and food, a big part of caring for a child requires financial support. Even when parents aren't living together, they often both retain financial responsibility for their child. Across the nation, divorced or separated parents provide monetary assistance to their child through child support payments. 

According to a report by the U.S. Census Bureau from 2017, less than half of parents who were supposed to receive child support payments received them in full. Child support paid in part or left unpaid can runs the risk of altering a child's lifestyle or leaves the other parent to take on more payments for a child, impacting their financial standing.

Depending on the situation, a person may face legal repercussions due to neglecting to pay child support payments. A divorce or separation is stressful enough without other issues making things any worse for you or your kids. For this reason, it is important to manage child support payments responsibly. Part of doing so means understanding why child support payments are important, how they are calculated, and your options for how to manage them.

What is Child Support For?

Child support payments are made to cover a wide range of expenses that directly impact the daily life of a child. On a basic level, it includes housing, meals, clothing, and other everyday costs, though child support payments often cover more than just these essential costs. 

From education to entertainment, all of these costs pertain to relevant aspects of a child's life. Even for parents who cannot be there all the time, being able to give a child these things comes along with the responsibility of parenting.

Calculating Child Support

A number of considerations are taken into account when determining how much child support a parent will pay, many of which are entirely specific to the family in question.

Each state has its own guidelines for calculating child support payments. If parents create their agreement for their child support arrangement, the court may approve their custom plan. If they are not in agreement, the court will craft the arrangement for them.

Many use one of two models for making this determination: the Income Shares Model and the Percentage of Income Model. Only a few states utilize a third model for determining child support, the Melson Formula.

Income Shares Model

The Income Shares Model is meant to determine child support payments by dividing the cost of raising a child based on each parents' income. This model offers the most popular method for calculating child support that is used by courts in most states, going off the belief that a child should receive the same monetary support that they would if their parents lived together.

In its simplest form, courts using the Income Sharing Model will establish the cost of covering a child's expenses each month and compare that to each parent's share of their combined income. Based on each parent's level of contribution to the combined income, ratios of responsibility to a child's monthly expenses are determined. If one parent earns and contributes more to the overall income, the court will often require them to pay their monthly contribution to the other parent.

Percentage of Income Model

In the Percentage of Income Model, the income of the non-custodial parent is the focus. The court will consider the number of children in a family and assign a percentage of that parent's income to be paid to the other parent using their state's specific child support standards chart. 

The percentage of income that a court deems necessary for the non-custodial parent to contribute towards child support can be a flat percentage, where it will not fluctuate as that parent's income increases or decreases, or a varying percentage, where it will adjust based on income changes. Again, it is a state-specific issue as to which percentage a parent will be assigned.

Melson Formula

Very few states use the Melson Formula when determining child support. In this model, the court will base child support payments on the specific needs of a child while also considering whether a parent's basic needs are also met. This model allows more funds to be assigned to child support payments as one or both parents' income increases. Determining child support payments using this formula can be more complex than utilizing the Income Shares Model or Percentage of Income Model.

Ways to Pay Child Support

No matter which way child support payments are calculated, it's key that parents have a clear plan in place for how they will send and receive these funds. Child support obligations are often written into your agreement, whether it was determined by the court or you and your co-parent decided on it yourselves. 

Mailing Checks & Money Orders

In some cases, a parent may send child support funds in the mail via checks or money orders. While doing so helps to keep payments private between parents, it runs the risk of payments being lost in the mail or not sent on time. It's also not as simple to report on these payments, leaving it up to each parent to keep track of when they sent or when they received funds. This can create discord between records if parents are not viewing the same payment details. 

Wage Garnishment

Wage garnishment is an automatic method of payment in which a parent's child support payments are automatically deducted from a parent's paycheck and sent either directly to the receiving parent or to the Child Support Enforcement Agency within their state. 

The benefit of wage garnishments is that they are automatic payments, making it easy to ensure that they are always made on time. However, some may consider it a disadvantage to have to go through your employer to make these payments. The parent paying or receiving these payments may find it embarrassing to have to share this kind of personal information with others. If the paying parent quits their current job and starts a new one, they will have to reestablish the garnishments with their new employer. Also, only so much money can be garnished from one's wages. If it's not enough to cover the total amount of child support, the paying parent may have to make an additional payment to send the total amount required. 

Other Secure Payment Methods

There are other ways to schedule automatic payments for child support without having to go through one's employer. On OurFamilyWizard, parents have the option to utilize OFWpay™ for child support and any other payments or reimbursements that must be sent between each other.

OFWpay™ facilitates secure money transfers directly between parents' bank accounts while keeping each parent's banking details private. The paying parent is able to schedule recurring payments via OFWpay™ so that funds are automatically transferred and deposited to the receiving parent as required.

OFWpay™ thoroughly details each payment, from the time it is sent to when it is successfully deposited. It's easy to get details on individual payments or generate a report of details about all payments to keep for personal records or share with an attorney or other family law practitioner.

Using OFWpay™ for child support payments, parents have the advantage of keeping their arrangements private, only sharing details they need to with their practitioners as needed. Scheduled payments with clear documentation to support them also helps make sure that everyone is on the same page before and after funds are sent.

Managing child support payments well is something that always should be taken seriously, and your attorney can answer specific questions regarding how to handle child support in your case. Yet, no matter the circumstance, it's key that parents understand what child support is for, how it is calculated, and what their options are for paying it.