Fourty pounds for a 12 year old is probably too much. Better to wait until he can handle the draw weight rather than make it uncomfortable, develop bad habits, etc.

The Sage is a great bow. You can go even cheaper with a Cartel riser and Sage limbs. Call Lancaster/Trad Tech and ask to speak to John Wert--he can set you up.

If you are looking for something fancier, call 3 Rivers or Kustom King and see what they have on hand.

For arrows, I'd leave them long, but tuning is the major factor. Leaving them long may let you use the same arrows as his draw length increases, but you want the arrows flying perfectly for the best penetration when hunting.