Financial implications of starting a family later in life

Published  17 October 2022
   7 min read

Latest figures from the Office for National Statistics show an increase in the number of women having babies later in life.

The number of women aged 40 and over having a baby in the UK has soared over recent decades, according to the Office for National Statistics (ONS). Latest figures for England and Wales show that there were 30,542 births in 2021 by women in this age group, compared to just 6,519 in 1982.

But while you may be more settled in your work, relationship and home when you’re older, babies are expensive at any age – and starting a family comes with particular financial considerations. Here, we look at some of the financial implications you might want to consider.


Falling income

You might benefit from a great maternity package from your employer. However, you could find yourself on Statutory Maternity Pay (SMP), amounting to around £156.66 or 90% of your average weekly earnings (whichever is lower) after about six weeks. This can be a shock if you’ve built up your career and you’re used to earning a stellar salary in your 40s.

This scenario could see your income sink dramatically after giving birth, so it pays to have a financial buffer in place. Hopefully, you’ll have spare cash set aside in instant access accounts for use in an emergency.



Bear in mind that mortgage options as you get older start to shrink, as lenders often don’t like to approve loans than extend beyond age 70. Yet you may need to move to a bigger home for a growing family, or want to remortgage to finance an extension, for example.

Also, if you have a child, lenders are less likely to agree to lend large sums if you’re paying hefty amounts for childcare. The amount you can afford in repayments will be assessed by a lender going through your regular bills, which includes any regular outgoings.

It’s worth speaking to a mortgage broker before the responsibilities of parenthood kick in, if getting a mortgage deal is on your to-do list over the next few years.  


Savings and pensions

It can be tricky saving money for your child and your retirement at the same time. When you reach your 40s, retirement planning should be a serious financial consideration – but if you have a baby, you may want to think about their long-term future too.

Hopefully, you’ll have started putting money away in a pension already. If not, you’ll want to get going, or perhaps boost your contributions into a current plan.

You may need to accept that if you’re an older parent you could be working for longer. After all, you may be already retired or approaching retirement by the time your child turns to the so-called ‘bank of mum and dad’ to help buy a first home.

Yet there are plenty of options to save for your child, such as a tax-efficient Junior ISA. Finding a balance of financially taking care of your children while also planning for your long-term future is key.


Your parents may be too old to help out with childcare, or have retired and moved abroad, for example. You may face paying out substantial sums in childcare, without any free help from family.

There is some help available – check the GOV.UK website which includes more information on getting help with paying for childcare. For example, in England, you may be able to get up to 30 hours free childcare if your child is three to four years old. Other government benefits may also help fund the cost, if you’re eligible.

You may also choose to search for other local families looking for childcare, either in person or online. This way, you could get a nanny to take care of two children at once, slashing the cost.


The cost of life insurance gets more expensive as you get older, but it’s an important consideration if you have children. Unfortunately, the older you get, the higher the chance you may suffer a serious illness. This makes it important to think about how you’d financially protect your family should you become ill, or die. Ideally, you’ll have enough life insurance to pay off outstanding and future debts. This could include your mortgage, childcare and your children’s education.

If you’re self-employed you might want to consider income protection cover too, which pays out a tax-free income after a few months if you’re unable to work due to illness, an accident or disability.

Updating your will

Many of us will have put a will in place by the time we reach our late 30s and 40s. If so, you’ll need to think about updating this after you’ve given birth. This should include who will be the guardian for your child if you’re not around. They may be a family member or close friend – it’s up to you, and an important consideration.

Finally, if you’re unsure about your personal financial situation, consider seeking professional advice to guide you on what action to take.


Harriet Meyer is a freelance writer and editor specialising in personal finance. She has written for a wide variety of publications, including The Observer, the Guardian, The Sunday Times, the Daily Telegraph, MoneySavingExpert, Moneywise, Investors Chronicle, and Saga.