Raising Children Late in Life: What You Should Know

Great parenting happens at every age, and growing trends prove it’s never too late to start (or expand) your family.

There has been a steady increase in women having children after 40; adoption agencies are reporting that people in their 50s and 60s are opening their homes to children; and some grandparents are raising their grandchildren when the kids’ parents are unable to.

Regardless of how older moms and dads come into parenting, they all want to create a stable financial life for their little ones while negotiating the life changes that come with age. Here are some ways to help juggle both those goals while raising children late in life.

1. BUILD YOUR TEAM

   Involve a financial planner or professional as well as an estate planning attorney. A financial professional can help you identify the best financial options for your kids as well as help you plan for goals like retirement. An estate planning attorney will put in place a clear system for how your child will be cared for in the event that something happens to you.

2. MAKE A FINANCIAL PLAN

   Older parents are likely to see their own retirement and health concerns intersect with the financial realities of raising a child and saving for college. There’s likely to be more strain on your dollars, so be more deliberate in how you allocate your money.

   If you’ve adopted or have a child who has special needs and requires additional care, factor in those costs for the long haul, and make sure you provide your child with adequate health insurance coverage.

   If you are already retired, you may find you have to make some changes to how you draw from certain accounts, or you may have to consider the pros and cons of secondary strategies like whole life insurance or income annuities, which could provide stability and flexibility when you need it.

   There’s likely to be more strain on your dollars, so be more deliberate in how you allocate your money.

   If you haven’t yet retired but could see yourself doing so while your child is either a minor or in college, be doubly focused on your retirement strategy. The instinct may be to put a lot of money into college savings, but that might have implications for student financial aid; plus, there are different ways to fund education. Many financial aid programs look at the assets of the family in determining whom to help. Most educational savings vehicles like 529 plans are factored into those calculations, while some retirement accounts may not be.

3. PROVIDE THE LEGAL BACKBONE

   First, you’ll need a will. This is the roadmap that lays out the steps you want taken to care for your child and your assets after your death. With your will, you name your beneficiaries.

   You’ll also need to designate a guardian for your child. If your child is a minor, the will should state how the assets should be managed until you feel the child is old enough to handle the assets. For example, your will might provide that the assets are held in a trust until the child reaches a specified age. You might name the same person to raise your child and manage his or her finances, or you may name more than one person to fulfill different roles. Either way, it’s important to detail how you want your assets allocated as well as any specific desires for how the money should be used and distributed.

   Finally, consider putting in place the following powers of attorney: a durable power of attorney, which names someone to act financially on your behalf in case of accident or illness; a power of attorney for health care, which designates someone to speak on your behalf regarding your health decisions; and a living will, which explains your health-care wishes to a doctor.

4. THINK LONG-TERM

   An essential part of a plan for an older parent involves putting in place steps to take care of yourself in case of a long-term illness or disability. Ask a financial planner or professional for strategies on how to help your child, or his or her guardian, arrange for your care.

Filling that empty nest will feel all the better once you have a strong plan in place to help ensure a solid future for your new family.