The â€œSandwich Generationâ€ is a unique group of adults roughly between the ages of 40 and 60 who find themselves caring for both their children and their aging parents. It can be difficult juggling multiple caregiving responsibilities, especially when the people youâ€™re caring for have very different needs. Oftentimes, members of the sandwich generation get so caught up taking care of others that they forget to take care of their own needsâ€”which is particularly true when it comes to their own financial or estate planning.
While aging parents can be a huge responsibility of the sandwich generation, you do not want to overlook your own financial planning needs. Ensuring you have a retirement fund, a college fund for your children, and a sufficient life insurance policy will secure your future, and that of your dependent loved ones. You should also have an emergency fund in place to cover medical bills, incidental costs, and other unexpected expenses that may arise.
In order to plan properly for the future, you need to understand the needs of your parents, your children, and yourself.
Start by looking at your own current financial situation. Sit down and assess your current finances, including all sources of monthly income, as well as your expenses. Be as specific as possible.
Next, move on to your parents. This might be a touchy subject, so hopefully they understand that you are not trying to take control of their finances, just assessing their situation. Do the same exercise by creating a breakdown of what their monthly financial needs are. What are they able to afford on their own based on sources of income, such as a pension or Social Security, and where might you need to help out? By having a comprehensive picture, you can better plan for a financially secure futureâ€”for both them and you!
If you have recently entered the sandwich generation or expect to be part of this generation for a long time, updating your own estate plan is also very important. Ensuring that your estate plan aligns with any impending lifestyle changesâ€”as well as your familyâ€™s long-term goalsâ€”is prudent. Review your will, trusts, and beneficiaries to see what may need to be adjusted. It is wise to consult with an estate planning attorney to review your plan in its entirety to ensure it is an effective designed for your current situation.
In addition to reviewing their financial planning, ensuring that your parents have the necessary estate planning documents in place will give you even more peace of mind. Documents such as a financial power of attorney, medical power of attorney, and a HIPAA authorization should be drafted well before your parents experience any cognitive loss, and will be crucial for you, as a caregiver, to be able to make important decisions on their behalf when the time comes. Having the right documents in place now will prevent complications down the road.
Download our FREE Guide: Estate Planning for the Sandwich Generation
With the holidays quickly approaching, many people are traveling home to be with their parentsâ€”and some people will realize that their parents are getting closer to needing more astute care. Now is the time to take action and ensure you have taken the necessary steps to protect you and your family. The Thanksgiving table may not be the best venue for these types of conversations, but using our free guideâ€”Estate Planning for the Sandwich Generationâ€”will give you some ideas on how to bring up the subject in the near future. Download the free guide now, and gain access to conversation starters and a helpful healthcare quiz that can help you and your parents identify which steps need to be taken, and why itâ€™s important to do so while they are still of sound health and mind.