Are you in the ‘Sandwich Generation?’
If you’re raising children while also caring for aging parents, you’ve joined the “sandwich generation”—a demographic caught between the responsibilities of supporting multiple generations simultaneously. With over 53 million Americans serving as family caregivers, this dual role is common, especially for those in their peak earning years.1
According to recent studies, more than half of Americans in their 40s are sandwiched between these dual caregiving responsibilities. This phenomenon becomes more prevalent as people live longer and have children later in life.2
The Financial Squeeze
There are a number of financial implications when caring for multiple generations:
- Rising childcare costs: The proportion of U.S. families allocating 20 percent or more of their yearly household income to childcare increased from 51 percent in 2021 to 60 percent in 2022.3
- Increasing elder care expenses: The median annual cost for a home health aide rose by 10 percent, reaching $75,500 in 2024.3
- Education funding: The average college tuition is projected to double in the next 10 years.3
- Retirement concerns: 42 percent of sandwich generation caregivers have redefined their approach to retirement.1
Strategies to Ease the Pressure
For many, the financial issues faced by those in the Sandwich Generation are compounded by time management challenges and emotional stress as they navigate complex family dynamics while trying to maintain their well-being and career trajectory. We’ve compiled tips to help you navigate the journey caring for both children and parents simultaneously.
1. Have Open Family Conversations About Finances
Begin by having candid discussions with both your parents and children about financial expectations and limitations. These conversations, while potentially difficult, establish clarity and shared understanding. Consider involving financial professionals who can provide guidance on issues like education, retirement, and healthcare arrangements.
2. Tackle Stress Efficiently
It’s completely normal to feel like there isn’t enough time in the day to handle all your personal and financial responsibilities. Tackling your stress is critical to ensuring you and your family are looked after. It’s important to remember to take care of yourself first in order to properly provide for the rest of your family. Here are a few things you can do to help with your stress levels:
- Make a list of important tasks and also the tasks that can wait. This can help you prioritize what you need to do.
- Make sure you are getting enough sleep.
- Exercise more.
- Make time to socialize with friends and other family members.
3. Prioritize Your Personal and Financial Needs
If you take the time to meet your personal and professional needs, you can stay fresh and energized to keep providing care for your loved ones. Feeling like you could’ve done more is natural, but prioritizing your time for personal and family needs will help enhance your physical and mental capacity. Whether it’s taking a walk in the park or reading a good book, make time to do things that are important to you outside of your family and establish boundaries to preserve your mental health
Additionally, while it may seem difficult at times, your financial future should remain a priority.
• Focus on retirement accounts
• Build an emergency fund for unexpected expenses
• Review and update your insurance coverage
4. Explore Available Resources
Several programs and resources exist to help sandwich generation caregivers:
- Medicare and Medicaid: Review what healthcare expenses might be covered for aging parents.
- Employer benefits: Many companies offer Employee Assistance Programs that include caregiving resources, flexible work arrangements, or dependent care accounts.
- Community services: Area Agencies on Aging, meal delivery programs, and adult day care can provide support and respite.4
5. Gather and Organize All Financial Documents
In order to formulate the best financial plan for you and your loved ones, collect everyone’s financial documents to help start the process of proper financial accounting. Having your parents share their financial accounts with you can help ensure all their bills and taxes are up to date. This can be a tough situation, but it’s important to remind your parents that you are only trying to do what’s best for them.
6. Don’t Forget Your Parents’ Role
Although you are responsible for your parent’s money, remember that it still belongs to them. If they are still in good mental health, collaborating with them on financial decisions can help ease the burden you face. They’ve managed their own money for most of their lives and deserve some involvement in the decision-making process.
7. Ask for Professional Help
Managing another person’s wealth is not an easy thing to handle. Working with a financial professional can help you with all aspects of your life, including retirement planning, education planning for your kids, and investing. Financial professionals can help you prepare the necessary documents for your parents and avoid costly mistakes.
While it may not always feel like it at the moment, your efforts to support multiple generations are creating a powerful legacy of care.
Book a meeting with us to see how we can further assist you in navigating these challenges.
Sources:
- Forbes.com, October 29, 2024
- PewResearch.org, April 2022
- Investopedia.com, January 6, 2024
- CBS.comApril 25, 2024
