Financial Advantages to Having Kids Early
Why it could make good money sense to start a family while you're young
The average age of first-time parents reached an all-time high in 2018.
According to a National Vital Statistics Report, the number of first-time moms in their 20s declined in 2018, while the number of first-time moms in their 30s and 40s increased. Births in general—not just first-time—to women in their late 30s and 40s, are occurring at the highest rate since the 1960s.
This trend can be partially attributed to millennials delaying parenthood until they feel more financially secure, particularly if they need to pay off student loan debt or save to buy a house. And waiting to have children does allow parents more time to hit career and financial milestones before taking on the estimated $233,610 it costs to raise each child.
However, having children earlier can benefit you financially. Here is a look at some of the advantages of having kids sooner rather than later.
Avoid Joining the Sandwich Generation
By having children earlier, you potentially avoid becoming a member of the “sandwich generation”—adults who are caught between caring for or supporting their own children and being responsible for their aging parents.
Many faced with this situation put their own financial needs on the back burner to prioritize those of their kids and parents. For some, that means delaying retirement and staying in the workforce longer than initially hoped or planned.
Raising children is a financial juggling act regardless of your age. But by having children at a younger age, you benefit from having fewer financial commitments at the same time.
Assistance From Grandparents
If you’re on the younger side, your parents and your in-laws likely are too. That makes it more likely that they are in a position to offer both practical help and monetary assistance.
More than half of grandparents with millennial children help out with childcare or running the household, providing their adult children a savings of $300 per week on average. Many grandparents also contribute financially towards college, clothing, extracurricular activities, vacations, and other expenses.
This support may be reduced or unavailable altogether to parents who delay having children until their own parents are older, less active, and living on a smaller income. Raising kids when your parents are able to offer assistance can provide significant savings.
Greater Flexibility in Your Career
While being more established in your career is touted as a benefit of waiting to have kids, opinion is actually mixed on whether that is truly advantageous.
In a Pew Research Center survey, 36% of respondents said women seeking a leadership role in their careers are better off having children early on, while 40% stated that they should wait until their careers are more established. (About 22% said the best option is not to have children at all.)
A break for maternity leave or sick leave to care for children could be easier to navigate in a growing career than in an established one where it may be harder to weather disruption in responsibilities.
Become an Empty Nester Early
Having children earlier will mean you’ll still be relatively young when they leave home—provided they don’t boomerang back to your basement couch.
This allows you more flexibility and freedom to focus on your financial needs in the years leading up to your retirement. You’ll also be in a position to provide the same support to your adult children and their families that you may have received when your own kids were young.
Find the Right Path for You
As with most major life events, there is no perfect time to have children. What is best for you boils down to your unique circumstances, goals, and preferences.
Whatever you choose, raising kids comes with a significant price tag. It's prudent to consider the financial advantages of having children early so you can make the best decision for your family.
Centers for Disease Control and Prevention. "National Vital Statistics Report. Births: Final Data for 2018," Pages 4-5. Accessed Jan. 12, 2021.
Centers for Disease Control and Prevention. "Table 1-7. Total Fertility Rates and Birth Rates, by Age of Mother and Race: United States, 1940-2003," Pages 1-2. Accessed Jan. 12, 2021.
U.S. Department of Agriculture. "The Cost of Raising a Child." Accessed Jan. 12, 2021.
TD Ameritrade. "Millennial Parent Research: And the Support They Receive From Their Parents," Pages 21, 29. Accessed Jan. 12, 2021.
Pew Research Center. "Women and Leadership." Accessed Jan. 12, 2021.