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  • Writer's pictureRob Edwards

Stuck in the middle

The Sandwich Generation


Our wealth management team’s motto: Let your money serve you.

However, for many of our clients, we find that their money is often serving the needs of others, too. Squeezed in the middle between caring for aging parents and supporting college-aged children, this cohort is often referred to as “The Sandwich Generation.”

People in this group often feel incredible financial stress. And who can blame them? They’ve worked hard to build a nest egg for themselves and, all of a sudden, Mom or Dad becomes ill, while at the same time, Jack or Jill just needs a little more help getting on their feet.


It can all be physically, emotionally, and financially draining.

To manage the competing demands, here are six tips for setting those priorities to help you deliver the support your loved ones need — without shortchanging yourself.

  1. Take care of your future first. Saving enough for your retirement should be a top priority. You have to take care of your needs before you help your parents and your children.

  2. Create or update your investment plan. Create an investment plan that will help you balance your financial goals with the needs of your children and parents. Review your budget, analyze your expenses, and set savings targets to help you prioritize planning for an upcoming expense, such as college costs or long-term care for your parents.

  3. Review your insurance coverage. Helping protect your assets is always a good idea, but it’s even more important when you have two generations depending on you. Make sure you have enough life insurance in case something happens to you to pay off your mortgage and other debt and to help cover the future living expenses of your dependents. And don’t forget disability insurance.

  4. Check-in on your parents’ financial health. Though it might seem awkward, talk to your parents about their wishes for the future and their financial health. What financial assets and expenses do they have? How do they plan to meet their financial obligations? Do they have a plan to cover the costs of long-term care? This conversation can help you determine how much financial support you may need to provide. Also, make sure your parents have done adequate estate planning, and ask for copies of their will or trust, durable power of attorney, health care power of attorney, and advance health care directive. Make sure your own estate planning documents are complete and updated as well.

  5. Consider reducing financial support for grown children. Many parents still help their grown children with their finances — sometimes even to their detriment. If you are paying for your adult kids’ cell phone bill or car insurance expenses, for example, talk with them about the steps they can take to start becoming more financially independent.

  6. Look for ways to help reduce your taxes. In some cases, you may be able to claim your aging parents as dependents. Also, check with a tax advisor to see if their medical expenses qualify as a tax deduction.


 

The Forbes Top Next-Gen Wealth Advisors Best-in-State rating algorithm is based on the previous year’s industry experience, interviews, compliance records, assets under management, revenue and other criteria by SHOOK Research, LLC. Investment performance is not a criterion. Self-completed survey was used for rating. This rating is not related to the quality of the investment advice and based solely on the disclosed criteria.

Insurance products are available through non-bank insurance agency affiliates of Wells Fargo & Company and underwritten by non-affiliated insurance companies. Not available in all states. This article was written by/for Wells Fargo Advisors and provided courtesy of Rob Edwards, Managing Director – Investments, in Naples, FL, at 239.254.2394.

Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, Member SIPC, a registered broker-dealer and non-bank affiliate of Wells Fargo & Company. ©2020-2023 Wells Fargo Clearing Services, LLC. All rights reserved.

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