The “Sandwich Generation” refers to the growing number of people that must be responsible for raising young children while caring for aging parents. Most members of the Sandwich Generation are in their 30’s, 40’s, and 50’s,
Caring for Both Parents and Children
Adults that are members of the Sandwich Generation feel increasing financial pressure as they try to support both their parents and young children. This stress is exacerbated by a lack of planning and preparation before the most pivotal years in both the parents’ and children’s lives. Individuals that find themselves stuck in the middle should keep the following advice in mind:
- Help Your Parents Create a Sustainable Retirement Plan
Talking about retirement and money isn’t something that most children want to discuss with their parents. However, it is important to discuss their plan for retirement income before they get older. Aging parents must have a conversation about medical treatment, plans if they can no longer care for themselves, wishes, and how they expect to pay for their care. These decisions are necessary to make if the parents outlive their nest egg.
- You Should Keep Saving Money for Retirement for Yourself
It can be tempting to dip into one’s retirement funds when trying to care for both children and aging parents. However, this puts one at risk of not fulfilling one’s retirement income needs. Members of the sandwich generation must take advantage of every opportunity to build their retirement funds early on. This means contributing enough to meet the maximum or their employer’s match, as well as adding to other tax-advantaged accounts like the 403(b), 401(k), Health Savings Account (HSA) or the Roth IRA.
In addition to contributing to one’s retirement funds, it is important to monitor one’s progress. Running a retirement calculation will allow an individual to see if they are on track. While it can be a challenge to calculate how much one needs to save for retirement, it can be helpful to consult a financial planner.
- Go Over the Various Options for Financing Long-Term Care
It is more than likely that individuals over 65 will need some form of long-term care. While family members may have done their planning for retirement, if they haven’t adequately prepared for long-term care, they will find it to be financially draining.
The Sandwich Generation must do what they can to plan for retirement, their parents’ retirement, and their children’s upbringing. Both aging parents and children must be apart of this financial plan as the generation stuck in the middle prepares for the future.