Financial Considerations When Having Kids Later in Life

Female physicians often need to postpone pregnancy and child-rearing due to the demands of their medical training. They find themselves in their late thirties or early forties, financially stable, and ready to have children. This is wonderful! Parenthood at any stage of life can change priorities and outlooks for the better. But things are different than in your 20s and there are lots of financial factors to consider.

There are definitely benefits of being an older parent: you have greater earning power and stability and you are more mature and confident. Just like anything else in life, though, there are also some concerns about parenting later in life. As a physician, you may be remarkably busy establishing your career and have less energy and less time to save for retirement. You may still be in debt with little in your savings accounts. By the time you are ready to retire, your child is ready for college and your parents may need some assistance.

Having children later in life is doable and made much less stressful when you have a plan in place. Here are our top tips for gaining control of your finances if you have kids later in life.

Purchase a modest and practical home

One of the largest expenses for people living in California is their home. It’s tempting to overspend on a dream home. However, once you are saddled with a large mortgage and high property taxes, it may be particularly challenging for you to save towards your other goals.  Purchasing a modest and practical home will accommodate your growing family’s needs and still allow you to save for retirement and baby-related costs.

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Save as much as you can

Having a baby can bring unexpected expenses, including:

  • Fertility treatments ($40-$50,000 is the national average for in-vitro)
  • Out of pocket medical expenses for you and the baby
  • Wage loss or reduction due to medical complications or desire to spend more time with the baby
  • Childcare costs ($14,000-$20,000 per year in California)

In anticipation of these expenses, save as much money as you can before and during your pregnancy.

Keep your debt manageable

Too much debt can get in the way of financial success. Review your student loans and other debts to see whether they need to be refinanced to lower interest rates or moved into a more suitable repayment plan.

More importantly, don’t take on any additional debt! Baby-related items in the store are made to entice you. Don’t use high interest credit cards or other debt to pay for those items. Before you set foot in the store, create a list of necessary items and a budget for each one. See our earlier post on Good Debt and Bad Debt for more guidance.

Save for college

College for your child may seem a long way off. However, it can be a very large cost, so you should start saving for college as soon as the baby is born.


We’re happy to answer any questions you have about our firm and our processes. Here are answers to some of the questions we receive most frequently.

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If your budget is stretched, start saving a modest monthly amount such as $50 or $100 into your child’s 529 plan. Each time your baby’s daycare/nanny expenses drop (as they age), add that amount to his or her college fund. By the time your child is in kindergarten, you may have an additional $1,400 or more each month you can save towards college or retirement. You can collaborate with a financial planner or use an online calculator to figure out when you can stop contributing.

Buy life insurance

We recommend buying a term life insurance policy to cover your financial responsibility until the child is grown. Check out what group life insurance policies are available through your employer or professional affiliations, especially if you have pre-existing health conditions. Group policies may be cheaper (sometimes free) and easier to qualify for.

Plan For retirement

If you want to retire early or in your 60s, save aggressively into retirement. Invest in your retirement first and in your children’s college education second. There is financial aid available for college, but not for retirement. Be prepared to stay in the workforce a little longer if you are planning to pay for both.

Organization and planning are key when you’re having children later in life. At Blankinship & Foster, an established firm of financial advisors in San Diego, we can help you organize, prioritize, and manage your financial plan so that parenthood at any age can be a joy. We can help you understand and calculate the different variables you’ll encounter. Starting this exercise before or during pregnancy is ideal, but we can help no matter what stage of parenthood you’re in.

About Monica Ma

Monica Ma, CFP®, CFA® is an advisor and the chair of the Investment Committee at Blankinship & Foster LLC. She helps clients build sound investment portfolios and develop strategic plans to reach their goals. Since Monica is passionate about sharing her knowledge with women and retirees, she co-leads the firm's Wise Women and Living Wisely Educational Series. Monica is a member of the International Community Foundation's Investment and Finance Committee. She has been living in San Diego since 2008 and enjoys travelling and cooking with her family.

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