Monday, May 25, 2015

Juggling the Challenges of the Sandwich Generation
January 23, 2014 by Staff Report | No Comments

Life expectancies are almost five years longer today than they were 30 years ago,* a fact that increases the likelihood you will provide some form…

Life expectancies are almost five years longer today than they were 30 years ago,* a fact that increases the likelihood you will provide some form of support for aging parents through home care, helping out with day-to-day chores and errands, or even covering living expenses.

That role can make significant demands on your time, energy and financial resources.

The challenge is even greater if youre also dealing with raising and educating children, or perhaps helping a new graduate get a start in the world.

While you may want to provide for everyones needs, its probably not possible, says Deborah Eickhoff, vice president, High Net Worth Planning Group at Wells Fargo Advisors.

Still, there is good news.

Consider the following four steps as you map out a strategy to help balance your family obligations without sacrificing your own financial security.

1. Prioritize your expenditures. Taking care of your parents and children at the cost of your own long-term financial security is counterproductive. Bear that in mind when youre deciding whether you can afford to give your children the luxury of a debt-free college education while simultaneously financing the cost of the nicest retirement home in the state for your parents.

Remember, you might not have the help in your own retirement that you are giving others, Eickhoff cautions.

Investors who begin setting up retirement plans in their 20s have different outcomes from those who begin in their 40s, Eickhoff notes. Regardless of where you are in that timeline, put your future first when considering how to juggle family obligations.

Start by creating your own retirement plan, Eickhoff says. Once you have that plan in place, you can figure out what you can actually afford to do for your kids and your parents.

A Wells Fargo Advisors Financial Advisor, using the Envision investment planning process, can help you create this plan and show you how helping kids and parents affects it.

2. Assess the situation. Develop a clear understanding of your role in your parents care and the finances that will have to support it. Start by getting a handle on your parents resources and current living costs, and try to estimate what the outlays will be down the road.

Long-term care costs vary by state, so if you and your parents are considering assisted living or home health care, you will have to do some research for the state where they expect to retire.

3. Make the most of financial resources. Spend and invest every dollar where it will do the most good. Use budgeting software to track your and your parents spending, and look for areas where you can cut back without inflicting too much pain.

Contributions to 401(k)s, IRAs and 529 college savings accounts offer tax benefits that can help your savings grow more quickly.

Long-term care insurance, which can help cover nursing home and home health care expenses, may be worth considering for your parents or for you. Eickhoff notes that premiums on such policies rise sharply for older buyers, but the coverage is more affordable for people in their 50s and 60s.

4. You have support. You dont have to do the heavy lifting alone. Reach out to other family members. They may have different ideas about how to help your parents, so discuss the level of care your parents need and define your respective roles.

Its important to discuss details such as how much time, energy and money each of you is willing to contribute to help your parents. Resources such as, and can provide useful information and contacts.

If you are an only child facing these challenges, reach out to friends, colleagues, neighbors and extended family for help. Regardless of your familys size, know that you can find assistance to help you manage.

People assume they have to take everything on themselves, Eickhoff says. They dont. They should ask for help.

* National Vital Statistics Report 2011.

This article was written by Wells Fargo Advisors and provided courtesy of Terry R. Campbell and Susan Paolo, Financial Advisors in Chardon at 440-286-2553.

Investments in securities and insurance products are: NOT FDIC-INSURED / NOT BANK-GUARANTEED / MAY LOSE VALUE

Wells Fargo Advisors, LLC, Member SIPC, is a registered broker-dealer and a separate non-bank affiliate of Wells Fargo & Company.

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