Advice for late-blooming parents

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First-time parents who are in their 40s and 50s face some retirement-planning issues that are different from those generally encountered by people who got an earlier start on rearing children.

A baby shower of advice

Put saving for your retirement first. There is a very real possibility that you’ll be paying for your child’s college education at the same time that you’re considering hanging up your work boots. Sheila Gugliuzza, managing director, wealth management for TIAA-CREF, advises that you put retirement savings ahead of other savings because you can’t borrow money for your retirement.

Find out if your child will be eligible for Social Security. Once you hit Social Security’s full retirement age, your children who are younger than 18 (or 19 if they are still in high school) are eligible for up to half of your benefit. This applies to natural, adopted and dependent stepchildren. A spouse who is too young to claim benefits on his or her own and who is caring for a child can also qualify.

For instance, if you were receiving $1,500 a month and you had a spouse and two children, each could receive $750 a month. There is a family maximum of 150 percent to 180 percent of the Social Security participant’s full benefit. Your own Social Security benefit won’t be reduced, and there are no income limits. Some people have dubbed this the “Viagra benefit,” and some of them are reluctant to take it. Gugliuzza says, don’t be shy. “When Social Security is available it definitely makes sense for people to take it.”

Invest in disability insurance. It is smart to buy a robust, long-term disability insurance plan. The Insurance Information Institute, a trade group, estimated in 2009 that a 40-year-old has a 43 percent chance of being disabled for more than 90 days by the time he turns 65.

Don’t neglect life insurance. Gugliuzza recommends that you consider buying insurance on your life in the amount of $250,000 for each child you have at a minimum.

Identify a parenting plan. Name a guardian for your child in case you are incapacitated and can’t provide care. Gugliuzza says you might consider picking two people — “a guardian to provide loving care and a financially savvy trustee to watch over the money.”

Get help preparing an estate plan. A simple will often isn’t enough to make sure that what you have accumulated goes to your child in the most efficient and beneficial way, says Gugliuzza.