We’ll get back to the election in our next post, but we thought everyone could use a little break to focus on a different, important subject.
It seems that HCM Advisors are seeing more families adapting their Retirement Wealth Plans to caregiving responsibilities than ever before. At a time when your career is peaking and you are looking ahead to your own retirement, you may find yourself in the position of having to help your children with college expenses or the financial challenges of young adulthood while at the same time looking after the needs of your aging parents. Squeezed in the middle, you're in the "sandwich generation" — a group loosely defined as people in their 40s to 60s who are "sandwiched" between caring for children and for aging parents.
While both men and women often must take care of children and parents simultaneously, the demand for providing care seems to disproportionately fall on women. As more people have children later in life and more parents live longer, the ranks of the sandwich generation are likely to grow in the years ahead. If you find yourself sandwiched between caregiving demands, here are some strategies to navigate this phase of life.
The day-to-day demands of caring for both an aging parent and children can put a tremendous strain — both emotional and financial — on the caregivers. This is especially true when adult siblings or family members don't agree on the best course of action for elder care, don't pitch in to do their share, or don't contribute enough financially to the cost of that care.
The first thing to do is get yourself in the proper frame of mind. This life phase could last one or two years, or it could last a decade (or more). In any case, try to treat this stage as a marathon and pace yourself; you don't want to start sprinting right out of the gate and burn out before your responsibilities end.
Encourage open communication with your family to determine ways to share the financial, emotional, and time burdens. Hold regular meetings to discuss issues, set priorities, and delegate tasks. Caretakers, especially women, are often conditioned to believe they have to "do it all," but there is no reason why adult siblings (if you have any) can't share in the workload.
It's important for caregivers to get their own financial house in order. Ironically, at the very time you need to do this, the demands of caregiving may cause you to lose income because you have to step back at work — through reduced hours, unpaid time off, or turning down a promotion. Here are some tips to keep your finances on track:
- Build this responsibility into your Family’s Comprehensive Wealth Plan Design. HCM can help you design scenarios around these responsibilities.
- Establish a budget and stick to it. Having a realistic budget can help you balance your income and expenses and keep your finances on track.
- Invest in your own future by putting as much as you can into your retirement plan and avoid raiding it to pay for your parent's care or your child's college education.
- Don't quit your job before exploring other arrangements. If you need more time at home than vacation or personal days can provide, ask your employer if you can telecommute, flex your hours, reduce your hours temporarily, or take unpaid leave. Another option is to enroll your parent in an adult day-care program or hire a home health aide to fill the gaps. Some employers offer elder-care resource locators or other caregiving support as an employee benefit, so make sure to check. Unless your Wealth Plan success rates are solid based on a retirement now, permanently leaving your job should be a last resort — time out of the workforce will reduce not only your earnings but possibly your Social Security benefit at retirement as well. And, it may be more difficult than anticipated to find new employment, or consulting engagements, at comparable compensation and benefits.
Caring for Your Parents
Talk to your parents about their financial resources. Do they have retirement income? Long-term care insurance? Do they own their home? Learn the whereabouts of all their documents and accounts, as well as the financial professionals and friends they rely on for advice and support. Much depends on whether your parent is living with you, in town, or out of town. If your parent lives a distance away, you'll have to monitor his or her welfare from afar — a challenging task. Though caregiving can be a major stress on anyone, distance can magnify it. Daily phone calls or video chats might not be enough, and traveling to your parent's home can be expensive and difficult to manage with your work and family responsibilities.
If your parent's needs are great enough, you may want to consider hiring a geriatric care manager, who can help oversee your parent's care and direct you to the right community resources, and/or a home health aide, who can check in on your parent during the week. Here are some things you should do:
- Take inventory of your parent's assets and consolidate his or her financial accounts.
- Get a current list of the medicines your parent takes and the doctors he or she sees.
- Have your parent establish a durable power of attorney and health-care directive, which gives you legal authority to handle financial and health-care decisions if your parent becomes incapacitated. And, at a minimum, make sure your parent has a will.
- If your parent's needs are great enough, you might need to go a step further and explore assisted-living options or nursing homes.
- Ask and expect adult siblings to help out. Siblings who may live far away and can't help out physically on a regular basis, for example, can make a financial contribution that can help you hire assistance. They can also research assisted-living or nursing home options. Don't try to do everything yourself.
Eventually, you might decide that your parent needs to move in with you. In that case, here are some suggestions to help make that transition smooth:
- Talk with your parent in advance about both of your expectations and concerns.
- If possible, set up a separate room and phone for your parent for some space and privacy.
- Research local programs to see what resources are offered for seniors; for example, the senior center may offer social gatherings or adult day care that can give you a much-needed break.
- Keep the lines of communication open, which can go a long way to the smooth running of your multigenerational family.
Meeting the Needs of Your Children
Your children may be feeling the effect of your situation more than you think, especially if they are teenagers. At a time when they still need your patience and attention, you may be preoccupied with your parent's care, meeting your work deadlines, and juggling your financial obligations. Here are some things to keep in mind as you try to balance your family's needs:
- Explain what changes may come about as you begin caring for your parent. Talk honestly about the pros and cons of having a grandparent in the house and be sympathetic and supportive of your children (and your spouse) as they try to adjust. Ask them to take responsibility for certain chores, but don't expect them to be the main caregivers.
- Discuss college plans. Encourage realistic expectations about the college they may be able to attend. Your kids may have to accept something other than what they hoped for, or at least get a job to help meet some costs.
- Teach your children how to spend wisely and set financial priorities.
- Try to build in some special time with your children doing activities they enjoy.
- If you have "boomerang children" who have returned home, make sure to share your expectations with them, too. Expect help with chores (above and beyond their own laundry and meal prep), occasional simple caregiving, and a financial contribution to monthly household expenses.
Considering Your Needs
This stage of life could last many years, or just a few. Try to pace yourself so you can make it for the long haul. As much as you can, try to get adequate sleep, eat nutritiously, and exercise — all things that will increase your ability to succeed. Don't feel guilty about taking time for yourself when you need it, whether it's a couple of hours holed up with a book or out to the movies (when the COVID bug is under control), or a longer weekend getaway. When you put your own needs first occasionally and look after yourself, you'll be in a better position to care for those around you.