How to navigate finances as the ‘sandwich’ generation – Daily News

on Aug21
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Are you feeling overwhelmed because you are caring for your aging parents and children? If you are providing care for both of these generations, you are part of what is called the sandwich generation.

The sandwich generation consists of adults who provide care for a parent 65 years or older while also raising a minor child or providing financial support for an adult child. This primarily includes middle-aged adults between the ages of 40 and 60.

There are three distinct types of sandwiches that make up this unique generation: traditional, club and open-faced.

Traditional sandwich generation: Adults who care for their aging parents and help or care for their children.

Club sandwich: Adults in their 50s or 60s who are sandwiched between aging parents, adult children and grandchildren. Or they’re adults in their 30s and 40s who care for both young children and aging parents and grandparents.

Open-faced sandwich: Anyone else who helps provide senior care.

The double load of raising your children while planning for retirement and caring for aging parents can cause both emotional and financial hardship. In addition to helping your parents with their daily needs, you may have an active role in assisting them with their finances.

For some people, this is a simple task. They provide basic oversight by reviewing their parents’ monthly statements and bills and only step in to do more when there is a problem.

They might also step in when it’s time to act as trustee for their parents’ trust. Often, this happens earlier and is more complex than people expect. Additionally, a trustee is a fiduciary. And as a fiduciary, the trustee is held to a strict standard of care. They must adhere to the terms of the trust.

If this applies to you, it’s important to realize that—even if it’s uncomfortable at first—you will need to assess and discuss both your and your parents’ finances, together. This task will help determine what your parents can afford and if you have the means to assist them financially. This discussion should include their wishes and expectations, as well as yours. Are the expectations realistic? Can your parents afford the standard of care they desire based on their income and savings? Do they expect to live with you, in their home, or in an independent senior living community?

As you discuss your parents’ finances, ask if they have long-term care insurance to offset the cost of care. This insurance can help pay for expenses related to aging, such as nursing home care, in-home care, and medical expenses.

Depending on the policy, it may partially or fully cover the costs related to your parent’s care. It offers protection in the event of an unexpected medical crisis while mitigating costs as well. Long-term care insurance can be expensive. It is typically best to purchase this insurance when a person is in their 50s, well before it is needed. As with any insurance, you may never use the policy, but if you do, it could be a valuable resource.

If managing your parents’ finances feels overwhelming, consider engaging with a certified financial planner to help you navigate this period. A CFP can help you and your parents understand their finances. The adviser can assist with a wide array of tasks, such as discussing the importance of having the appropriate estate planning documents in place; reviewing and explaining your long-term care insurance policies; and running cash-flow projections based on various assumptions.

A financial adviser can also aid you and your parents in understanding if their income will sustain the lifestyle they desire. This extra support can ease the burden of managing your loved one’s finances, giving you more time to focus on other responsibilities.

Organize, manage finances

As you clarify your parents’ financial priorities, it is critical to create a realistic budget for your family. This will help you track your spending and ensure that you are not overspending so you can continue to provide for the needs of your children and, if necessary, your parents. Make sure to include all expenses, such as housing, utilities, food, medications, insurance needs, and non-essential expenses.

Plan for retirement

Because this can be a stressful period, it is easy for caregivers to focus solely on their immediate financial obligations and set future planning aside. You only have so much bandwidth after all, and managing the day-to-day duties of caregiving can require a great deal of energy. However, it is essential to plan for your future, including having the proper estate planning documents in place, in addition to funding your retirement. Prioritize setting aside funds for retirement, even if it is difficult.

Planning and staying focused during this period means you will have a better chance of achieving the lifestyle you desire in retirement. Make your finances a priority, and you’ll reap the benefits in the future.

Hold family meetings

It is essential to communicate with your parents about their future care and finances. Identify their priorities and your or other family members’ roles in assisting them. Pencil out a plan. This can help reduce misunderstandings or conflicts and ensure that everyone is moving forward in a like-minded way. As our parents get older and undergo normal decline, they require more assistance. Accepting this truth may be difficult for them, for you, and for your family members.

Implementing a unified plan will help your family work together in coordination while minimizing stress from the tasks that need to be completed and the changes that will occur.

Prior to holding each family meeting, write an agenda. This helps all attendees stay focused on the items at hand. Also, determine who will facilitate the discussion. The objective is to stay on topic while holding productive meetings on serious issues that may be emotionally charged or difficult to discuss.

Curate resources

The California Department of Aging ( provides a wide range of resources to assist with caring for the aging. This includes a one-stop guide titled, “Over 60? Here’s How to Thrive in California.” This online resource includes a direct link to aging services in each county.

The agencies it will point you to provide referral information and resources for people seeking aging and caregiving services, such as adult daycare, respite care, home repairs and modifications, personal care, and more.

If you are part of the sandwich generation, you are probably facing unique financial challenges that require careful planning and prioritization. Success requires that you set priorities, utilize assistance programs, make and stick to a budget, and save for your own retirement. By communicating your boundaries, goals, and objectives with your family members, you can successfully manage your time and finances while providing care for your loved ones.

Teri Parker is a vice president for CAPTRUST Financial Advisors. She has practiced in the field of financial planning and investment management since 2000. Reach her via email at

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