Reducing the Sandwich Generation’s Financial Burden

Pew Research Center survey findings in 2021 show that 23% of Americans are part of the “sandwich generation”. As the senior population grows and younger adults struggle to gain financial independence, many middle-aged adults find themselves “sandwiched” between their children and parents. This generation is raising or providing financial support to their minor children while also providing care or assistance to aging parents. The sandwich generation faces unique financial stress.

The Financial Burden of the Sandwich Generation.

As a parent to a minor child and an elderly parent, you may find yourself caring for both. While you may not mind the responsibility, the financial strain can be a tremendous burden.

Caring for Children

As a parent, you are financially responsible for the well-being of your minor child. Common expenses include moving into a larger home to accommodate a growing family, daycare costs, extracurricular activities, enrichment programs, college savings, medical bills, and necessities that children require to thrive.

Caring for Senior Parents

As a caregiver to a senior parent, you are faced with other significant expenses, especially if your senior parent did not adequately plan for the anticipated cost of aging. Typical expenses that coincide with caring for a senior adult surround declining health or degenerative aging. Housing needs change as our parents require more assistance with daily care or around-the-clock services. In this case, the cost of assisted living or nursing home care may become your burden to carry. Medical treatments, hospital stays, and prescription drug costs can also come with a high price. Additionally, if a parent has not properly planned for retirement, they may be unable to afford basic hygiene, housing, and nutritional needs.

Time is Money

In addition to the direct financial stressors, time plays a significant role for the sandwich generation. Time is limited by parenting alone. Parents are juggling their careers while raising children. They may miss work to stay home with their sick children or tend to their individual needs. As a caregiver, time away from your career and other personal obligations will be increased. Some caregivers may find themselves leaving their careers entirely. This can greatly impact financial stability and even retirement plans of your own.

Tips for Easing the Financial Burden

Under the circumstances mentioned above, it may be tempting to sacrifice your financial stability. However, this sacrifice could have potentially devastating effects. Fortunately, there are better ways to cope with the financial burden of being part of the sandwich generation.

• Scholarships. Before assuming the financial responsibility or college tuition, thoroughly research scholarships available for your child. 

• Student loans. Most parents want to provide for their children’s education and don’t like the idea of student loans. However, the truth is that your child has much more time to pay off loans than you will to replenish your savings or retirement accounts. 

• Multigenerational living. Young adult children may need financial help as they get on their feet. Instead of paying their bills, welcome them back into the house. This will allow them to save money without relying on your financial help. Additionally, you may also want to consider allowing your adult parent to move into the family house.

• Downsizing. If assisted living or nursing home care is not necessary, it may be time to reassess where your parent is living. Downsizing them to a smaller home or “mother-in-law” suite can minimize expenses.

• Government assistance. Look into any Medicare, Medicaid, available Veteran benefits, or other government assistance programs that your parent may qualify for, or find out if you can maximize what they are already receiving.

• Ask for help. Don’t hesitate to ask other family members to help with transportation or appointments that may affect your ability to work.

• Set boundaries. Communicating clear boundaries and limitations of the financial support you can provide is one of the most important aspects of your responsibility. It is imperative that you don’t sacrifice your own financial stability due to your circumstances. Setting boundaries and effectively communicating will allow family members to understand limitations and work toward a similar goal together. 

Planning for the future is imperative if you are part of the sandwich generation and is most effective when under the guidance of an elder law attorney. Our elder attorneys are experienced and happy to help you minimize the financial burdens due to your unique situation. If you have questions or would like to discuss your legal matters, please do not hesitate to contact our office at 215-364-1111 to schedule a consultation.