Solutions Series: Solutions for the Sandwich Generation

Woman of WealthLeftover Thanksgiving turkey, peanut butter & jelly, Reuben, BLT…these are frequent images that come to mind at the mention of a sandwich. No matter what the filling, a sandwich is both tasty and satisfying. Most of us think of hese types of sandwiches, unless, of course, you are sandwiched yourself. “Sandwich” takes on new meaning when you feel stuck between two places or squeezed. Many women, and sometimes men, experience being sandwiched when they face tending to the generations on either side of their own. Shifting demographics, increased lifespan and later childbearing over the last few decades have contributed to a new phenomenon: the “Sandwich Generation.”

A common sociological term, Sandwich Generation refers to a group of people between the ages of 40 and 60 who are caring for both their aging parents and attending to the needs of their own children. While intergenerational co-habitation and interdependence have threads in the fabric of many cultures, attention to the sandwich phenomenon has grown over the years as the baby boomers aged, their parents lived longer, women delayed childbearing and remained in the paid workplace after childbirth, boomer children remained dependents past the age of eighteen and families were more geographically spread out. These many factors made eldercare and related decisions more complicated and troublesome, often even traumatic, for families juggling many fronts.

In fact, nearly 10 million people, or 1 in 8 Americans according to the Pew Research Organization, are caught between two generations who both need their support, energy and time at an average cost of $324,044 in lost wages and Social Security benefits per person. Because they are more likely than men to drop out of the workforce or reduce their work hours to care for aging parents, sandwiched women share concerns around their own financial future in retirement and their ability to address the financial hopes and expectations they held toward supporting their own children and paying for their educations.

The Family Wealth Advisory Council study Women of Wealth, co-authored by Fairport’s Managing Partner Heather Ettinger, surveyed over 550 women across the United States. The majority of these women identified their single most significant transition challenge in the next year as providing financially and emotionally for both their children and their parents. Furthermore, this responsibility is not limited to married women. Over32% of single women surveyed were concerned about “helping children in crisis.” Heather says, “Everyone’s financial situations are unique. Families face making difficult decisions pertaining to their current financial needs, saving for the future and planning for their elders’ care. It’s not easy to know where and when to move resources while also feeling like you can take care of yourself and your own future needs.” She adds that a sandwiched woman might take a year off of work with the intent of caring for an aging parent, but because the demands are so great and the needs so deep, she might extend that unpaid time to two, three, even four or more years. The cost of needing and wanting to do that is very significant and far beyond simply lost income.

There are associated costs with not being able to continue a working pace in saving for retirement, contributing to Social Security and earning tenure with an employer. “What was once thought as prime earning years evaporate before the caregivers’ eyes,” she says.  What to do? There is help available. Find a financial advisor who is focused on life planning and uses a more holistic approach to understanding all the cross currents in your life that cause that feeling of being “sandwiched.” Their process is built on taking the time and care to understand and recognize your unique needs by asking many questions and listening to your responses, providing education and referring you to other resources. Rather than the investment product focus of a stock broker, these advisors, often referred to as wealth managers, lead with a financial planning process and collaborate with your other advisors.

Heather explains, “If you are juggling multi-generational care and the financial burden that comes with it, you need a financial advisor who has experience with specific planning and tax strategies in this arena, as well as the networks to access other potential resources and professionals.” No two family situations are alike and you need that financial quarterback to help you navigate the challenges that you face on your journey. This might include eldercare resources, tax advantaged college savings strategies, accessing additional benefits of employer plans, federal healthcare plans and more. A good financial advisor can travel on this journey with you, quarterback other advisors and tailor services and solutions for you and your family. Getting your financial plan in sync with your life plan will smooth any transition, including that into sandwich territory.