There’s more and more gray hair at parent-teacher night. In the past 20 years, fewer Americans have been having kids in their teens and 20s and far more are becoming parents in their late 30s and 40s.
Since 1995, the birth rate for mothers in their late 30s is up 45 percent, and moms are 58 percent more likely to give birth in their early 40s. Giving birth in your late 40s is still rare but a lot less so: In the past two decades, the birth rate per 1,000 women age 45 to 49 has almost tripled, from 0.3 percent to 0.8 percent.
There are great reasons to wait to have kids. Older parents are often wealthier, more mature, and further along in their careers. But becoming a parent late in life can also really complicate your finances.
Bloomberg Business asked financial planners what issues parents should prepare for when they’re caring for children well into their 40s, 50s, and 60s. Here’s their advice:
• Don’t expect to live forever. All parents need to think about what happens after they’re gone. But for older parents, wills, estate planning and life insurance become crucial. The 55- to 64-year-old parent of a college student is almost five times as likely to die in a given year as one in his or her late 30s or early 40s.
Bryan Beatty is a 47-year-old financial planner who just had his first child in March. When a baby is born, his or her parents are focused on feeding schedules and fighting sleep deprivation, not on wills and trusts. Still, “they should do it right away,” says Beatty, a partner at Egan, Berger & Weiner.
Particularly important is choosing a guardian in case anything happens to you. Many young couples choose the baby’s grandparents, but that might not be an option for older parents whose own parents are in their 70s or 80s.