Here are some helpful tips and resources for managing finances when you're taking care of multiple generations.
For members of the "sandwich generation," many personal and practical challenges present themselves as uncharted territory. In addition to funding healthcare costs for their own family, many "sandwichers" are saving for their children's college tuition and caring for aging parents, including managing health-related concerns and the cost of healthcare.
- Start the Conversation: Though it might be difficult, have ongoing conversations with your parents about their finances before something serious like a medical or financial emergency occurs.
- Map Out a Budget: Draw up a simple budget that lists their basic living costs, including housing, food, transportation and insurance. Compare these with steady income sources available to them, such as Social Security, and annuities and pensions, if any.
- Get Healthcare Details: Learn specific information about their health and long-term-care insurance, and any other resources available to them, to determine whether they're able to contribute to their healthcare expenses. Over time, they may rely even more on your support, so consider having discussions about things like establishing a healthcare proxy and a living will.
- Talk to a Pro: An elder care attorney can coordinate with professionals from financial, health and legal areas to help navigate and address issues for older adults – ranging from making sure an estate plan is in place, to protecting personal assets, to guardianship and more.
For Your Children
- Talk College: If you have teenage children, talk with them about college to get an idea of where they may be interested in going. Exploring options that meet their potential wants and needs will give you a clearer idea of costs and what might fit within your budget.
- Keep on Saving: Learn about college savings vehicles. The 529 Plan, a tax-advantaged savings plan sponsored by states, state agencies or educational institutions, is designed to encourage saving for future education costs. The Coverdell Education Savings Account is a federally sponsored, tax-advantaged trust or custodial account set up to pay for qualified education expenses.
- Research Payment Strategies: Find out whether your children qualify for financial aid, and look into the possibility of scholarships. Numerous resources are available to research this, including The College Board, which is known for college-readiness testing, but also has a section dedicated to scholarship opportunities.