Father scrolling on smartphone while newborn child sleeping in baby carrier (Image: Getty)
Britain’s birth rate may be plunging but in an overlooked trend more people are having children later in life. The average age of parents keeps edging upwards, while the number of births among parents under 35 is falling.
According to the latest Office for National Statistics figures, there was a 5% rise last year in births where the father was over 60, taking the total to 1,126. That figure has jumped by a fifth in just two years.
The financial implications can be huge as it leaves older parents juggling mortgages, retirement planning and rising childcare costs at the same time.
Sarah Coles, head of personal finance at AJ Bell, said higher house prices and rents have made it harder for younger people. “Anyone who wants to get settled in their own home before starting a family often has a longer wait on their hands.”
Older parents are often more established in their careers, may have more savings behind them and are more likely to own their home. Coles said: “They may also have more savings and investments, allowing them to cover the expense of the early years of childhood without running up debts.”
However, later parenthood can create major pressures too. One of the biggest is housing. Many parents need to move up the property ladder once children arrive, but lenders may insist they repay the mortgage in full before hitting state pension age. Coles said: “Some who have children later in life will have to repay a bigger mortgage over a shorter period, and wrestle with hefty monthly payments.”
That can leave parents making difficult compromises over where they live and how much they can afford to save towards retirement.
The timing of retirement itself can become tricky too.
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If someone has a child at 40 and that child remains at home until 25, the family home may not empty until the parent reaches 65, Coles said: “Traditionally this was the period when people’s outgoings fell and they could boost their pension savings to build for retirement. At 65, it doesn’t give you long.”
Some parents may even find themselves postponing retirement altogether.
Coles suggested starting a Junior ISA as early as possible to build savings for university or other future costs.
Insurance is also important for older parents. “There’s a higher risk of you getting ill during their childhood, so consider buying vital insurance such as income protection and critical illness cover,” Coles said.
You also need to update your will, so it covers new family arrivals as well as the existing members.
Almost half of all children are now born outside marriage or civil partnerships, but unmarried parents face extra complications as they don’t automatically inherit from one another.”
Without a will, children may inherit instead, potentially creating legal and financial headaches for the surviving parent. “If you split up and one of you owns the home, the other has no right to stay in it or gain any share,” Coles added.
She said unmarried couples should consider making wills and possibly drawing up cohabitation agreements to clarify how assets should be divided if relationships break down.
Married couples and civil partners have tax advantages, as they can double up on their inheritance tax and capital gains tax allowances.
Having children later in life can work perfectly well financially, but only if parents think ahead.
