If you’re already in your sixties, or nearly, and feeling the financial squeeze of the needs of aging parents and growing children, there are still a few things you can do to lower your stress level and increase your peace of mind. You might consider working a little longer, trimming your expenses, and urging your kids to explore every option for college financial aid - especially merit grants or scholarships that neither of you will have to repay after they graduate.
If you’re in your forties or fifties, you have more time to plan and make preparations before you find yourself caught in the sandwich generation.
Regardless of your age, here are a few steps you can take that may help you manage the needs of your aging parents and adult children without getting squeezed by sandwich generation problems:
Preserve Your Assets - Don’t be a sandwich generation martyr by raiding your retirement savings to pay for your children’s college education or your parents’ long-term care. Your kids can take out student loans if necessary, and you should use your parents own assets to finance their care for as long as possible.
Plan Ahead - Keep the sandwich generation trend in mind when you’re projecting what kind of income you’ll need in retirement. Be sure to consider the possibility that you'll end up in the sandwich generation one or more of your kids may need to come back home for awhile, raising your monthly costs or maybe delaying your plan to move to a smaller home. And if you have one or more parents still living, count on joining the sandwich generation as your parents may also need your financial help.
Assess the Situation Before Sandwich Generation Problems Arise - As early as possible, consider sandwich generation issues. Talk with your parents about their assets, how they want to live as they age, what kind of health care and lifesaving measures they do or don't want, and who should make legal and medical decisions for them if they are no longer able to handle their own affairs. This may be a difficult and uncomfortable conversation for you and your parents, but answering these questions while there is still time to plan ahead can help you both avoid a lot of sandwich generation problems.
Get Insurance - Look into the viability of long-term care insurance for your parents and yourself. If you or your parents eventually require nursing home care, long-term care insurance could help offset those asset-draining costs.
Put Yourself First - Because you’re both a conscientious parent and a dutiful child, you may be tempted to put your own needs after those of your aging parents and adult children if you find yourself in a sandwich generation scenario. Don’t.
The only person who can save for your retirement is you. To avoid many sandwich generation problems and help your parents and your children you first have to keep your own financial house in order.
Finally, don't forget that being part of the sandwich generation and caring for others can be hard on your physical and emotional health as well as your financial well-being. You need to maintain social contacts, tend to your marriages or romantic relationships and find time to play. To learn how you can take care of yourself while caring for others, see Caring for Caregivers.