Generation X is commonly called the sandwich generation for two reasons. First, they are sandwiched between the Millennials and the Baby Boomers, both groups that seem to hog media coverage — and marketing budgets. More importantly, many Gen Xers face the modern problem of caring for their elderly parents while still also caring for their own children. (See also: 6 Ways the Sandwich Generation Can Get Ahead)
Being in the sandwich generation can be stressful and financially draining. Here are five strategies to stay financially afloat if you’re caring for others.
1. Talk Openly About Finances
Whether your elderly parents live with you or not, it is important to know where they stand financially. For families that didn’t grow up talking about money, this might feel awkward. However, it is important for you to be prepared to assume financial responsibility if anything were to happen.
Of course, it is best to have this talk with a certified financial planner and estate attorney, as well. There are a lot of financial matters to discuss.
- Who has power of attorney?
- Where will the funds for your parents’ care come from?
- Should your parents be receiving veterans’ benefits or Medicaid assistance?
- Do your parents have any investments, and are they making the best rate of return on them?
- Do your parents have long-term care insurance or enough retirement savings to cover care costs?
2. Utilize Special Savings Accounts
Money will be tight when you are caring for your parents and children at the same time, but don’t neglect saving accounts. Contribute as much as you can to your retirement account and even look into a 529…