Can You Afford to Start Parenting at Middle Age?

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Advances in reproductive technology and a trend towards marriage later in life have led to an increase in older parents. But do these old fogies know what they’re getting themselves into, financially speaking?

Actually, there are some economic advantages to having children when you’ve reached a more mature age (for more, read Jeffrey Kluger’s story in the new issue of TIME, available to subscribers here). Older parents tend to be more financially stable. They’ve (hopefully) eliminated their student loans and dug out of any ill-conceived credit-card debt run up in their young adult years. They’re more likely than parents who are barely out of their teens to own a home and have money set aside for retirement and emergency expenses.

There’s a “but” here, though. Taking on parenthood at a more advanced age can mean paying for things like tuition and textbooks when many of your peers are enjoying the financial freedom of being empty-nesters. And with a growing number of adult children returning home to live after college, there’s a good chance that your kid could still be raiding the fridge when you’re eligible for Social Security. None of this has to be a dealbreaker, of course; it just requires more forethought and planning. Here are some questions experts in financial planning and late-in-life parenting suggest that you should ask yourself before trying to have a child.

Who’s paying for college? The biggest financial challenge for older parents is that they’ll probably be looking to retire just when some major financial obligations hit. “Retirement dates coincide with college and wedding expenses,” says David Lamp, a certified financial planner at Brighton Jones. “I’d say the cluster of life events is a little bit tighter now.”

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As a parent, the impulse to give your child the best of everything is only natural, but it also can be financially devastating, he says. The smart move is to “favor putting money towards retirement, with the idea being that there are fewer ways to fund retirement than college.” Although this is the logical decision from an academic standpoint, Lamp says it can be a challenge for parents to pay themselves first and set realistic expectations about, say, what kind of school they can afford or how big of a wedding they can bankroll.

Can you keep your retirement savings goals intact? Financial planners say it’s not advisable to invest differently just because there’s a crib in what used to be the spare bedroom. In fact, Lamp says that while it’s tempting to push into riskier assets to try and make up for a shortfall in contributions, investing in pursuit of outsized gains is more likely to backfire than to make you rich.

Will you have to move? While older Americans may be more likely to own their own homes and have equity established, that does present a drawback in that a house that’s satisfactory for you and a partner may be inappropriate or inadequate for a family that includes young kids and, eventually, teenagers.

It’s a bad idea to start a new 30-year mortgage at 45 or 50, cautions Cathy Pareto, financial planner and president of Cathy Pareto and Associates. “If you’re going to reset the clock on a new home to accommodate a growing family, you might have to accept the fact that you can’t live in the coolest part of town anymore,” she says. “Find the number that lets you afford a 15-year mortgage.”

Will you or your partner take time off from work? Older parents are generally at their earnings and career peak. While this gives them more resources to care for a child, it also means that negotiating time away from the office is trickier, says Janice Wassel, director of the Gerontology Program at the University of North Carolina at Greensboro. Not only are lost income and retirement incentives like a 401(k) match likely to deeply affect the family budget, but transitioning back to the workforce can be more challenging for employees who have already worked their way up the corporate ladder.

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“That’s a real consideration if you’re going to step out for six months or a year,” she says. “Are you going to get that career back, and are you going to be on the same trajectory?”

Do you have enough life insurance? A policy intended to protect your spouse or partner’s standard of living in the event of your death won’t be enough to cover the expenses of raising a child, Pareto says. “You’re probably going to need more of it, and it’s going to cost a lot more than you thought,” she says. Even non-working parents should carry life insurance if there’s a kid in the picture, since a surviving spouse or partner will have to pay for childcare. “That has an economic value a lot of people haven’t considered,” she says.

What about your parents? More middle-aged people are becoming part of the so-called sandwich generation, caring for elderly parents as well as raising kids. Even if a parent or in-law isn’t living with you, the financial obligations can add up, says Wassel. “It’s one of the indirect consequences of people living longer,” she says.

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Maybe you’re paying for transportation, lawn care, and snow shoveling services, or burning gas and money on frequent visits to check in on them. Many adult children find themselves helping with out-of-pocket costs for everything from haircuts to clothing, especially if a parent is in an assisted living-facility and depends on Medicaid, which sharply limits the amount of assets the patient can claim as their own.

Have you built in a bigger buffer for emergencies? The experts say many people routinely underestimate the bite a child takes out of a household budget. Clothes, medical care, school supplies, after-school activities — the list seems endless. Of course, parents of all ages can be gobsmacked by a math tutor or orthodontist’s bill. The difference with older parents is that they have a smaller margin for error if those expenses are being paid out of funds diverted from an IRA or other retirement-savings vehicle.

“Time is on the side of the younger parents,” Lamp says. “They have more working years ahead of them.” Even if an older parents intend to work until the age of 70, they may not have the ability if age-related health issues emerge, he says. Keep the funds parked in short-term CDs or money-market accounts. Yes, they’ll earn less interest, but they’re easier to access if the need arises.