How to share child-related expenses after divorce: Creating a co-parenting plan that works

Parenting is rarely easy, even at the best of times. But after a relationship ends, it takes extra care and consideration to keep everyone moving in the right direction.

What might work in the early days of a divorce may no longer work for your family as incomes change, kids get older and new expenses come into play. Initial conversations about shared custody can help avoid confusion and tension, but they’re just the beginning. Creating a parenting plan that evolves with your child is one of the best ways to keep things fair and manageable as financial responsibilities shift over time. Here’s what you need to know.

How much does it cost to raise a child in Canada?

Between food, clothes, extracurriculars, birthdays and more, the cost of raising kids can be more than you might think. According to a Statistics Canada study released in 2024*, a typical two-parent, middle-income family with two children will spend around $293,000 per child by the time they reach 17 years of age, which works out to more than $17,000 per year. Finding an amicable way to manage your kids’ current and future expenses with your former partner can help you move forward while putting your child’s best interests first.

A custody agreement vs. a parenting plan

After a divorce, financial responsibilities are usually shaped by two things: your custody agreement and your parenting plan. Custody agreements outline who makes major decisions and where the child lives. Parenting plans focus on the everyday: who handles school pickups, how communication works and how expenses will be shared.

Canadian courts use the Child Support Guidelines to divide basic costs, such as housing, food and clothing. These rules are based on income and living arrangements, and they offer a useful starting point, but they don’t cover everything. Even with support in place, many everyday costs fall outside what the court decides. That’s where your parenting plan comes in. 

Creating a plan that works

You can’t predict every cost, but a strong parenting plan helps you stay focused on the things that matter most. Start by outlining which expenses each parent will take on, how you’ll handle shared costs, and what to do if you disagree. To help avoid surprises, some parents set a monthly limit for extras or agree to check in with each other before spending over a certain amount on unexpected items.

It’s also a good idea to track spending as you go. Whether you use an app, a spreadsheet or shared receipts, keeping a record helps reduce confusion and makes it easier to adjust if things feel off balance. Try to revisit the plan once a year (or sooner if there’s a big change in income, work schedules or your child’s needs). Putting the plan in writing helps keep everyone on the same page.

Common expenses

As mentioned earlier, some core costs, such as food, clothing and housing, are usually addressed through child support. In joint custody arrangements, where time is split more evenly, those costs might be shared instead. Here are some other expenses you’ll need to consider.

Planning ahead: Education and savings

If you opened an RESP while you were together, make sure to confirm who owns the account and who the listed beneficiaries are. You’ll also want to agree on how future contributions will work and whether both parents will continue saving. Even if the RESP is in one person’s name, it helps to include expectations in the parenting plan to avoid confusion later. If the RESP is jointly owned, you’ll need to decide how withdrawals will be handled and who controls the account going forward.

Some parents use Tax-Free Savings Accounts (TFSAs) to set aside money for big future expenses, such as a first car. You don’t have to map out every detail, but having a general plan and reviewing it regularly can help you stay on the same page. 

Avoid using the courts to resolve financial disputes

Sometimes the only way to resolve financial disputes and do what’s right for your kids is to ask the courts to step in. But it may be smart to explore all your options first, such as mediation or open conversation, before going that route. Legal fees can quickly climb past $10,000 per parent, cases can drag out for a year or longer, and it can be emotionally taxing for everyone involved. As a guiding principle, you should always choose the option that puts the best interests of your child first.