Welcome to the Sandwich Generation
Mom and Dad are screwed and by association so am I.
The sandwich generation, as it has been named, is a frightening economic situation where middle aged couples face the difficulty of supporting both their children as well as their parents.
In about four or so years, my fiancé and I expect to start a family. Once that happens I anticipate, as most reasonable couples would, that our expenses are going to increase. We’ll be supporting a family of our own and besides being exciting, it will undoubtedly be expensive. We will need a bigger place to live. Our grocery, utilities, and other spending categories will increase in kind.
Also in about four or so years, my parents will arrive at retirement age. That is scary when I consider everything working against them.
- So far they have very little saved for retirement.
- They are still paying for their mortgage.
- They still support all of my siblings in some way.
That’s not a great way to head into the golden years. With only four years to go, there isn’t much they can do. I don’t expect them to be able to make up a lifetime of retirement savings in fraction of the time. It was their choice all through life to sacrifice for my siblings and I. My parents have always joked that retirement would be downgrading to a forty hour work week. With that reality slowly sneaking up on us, I feel pressure to provide for them, at least in part, to make up for all they did when I was younger.
That doesn’t sit well with my future wife. We shouldn’t have to handicap our new family to make up for my parent’s situation. It is after all, going to be our money in a few short months and not my own. Everything I have and will have will be hers as much as it is mine.
That being said, there are ways to mitigate the effect of the sandwich. It’s a two pronged approach and it starts with my parents.
How to Survive the Sandwich?
In as few words as possible, be prepared for it. It’s not like this is going to be a surprise. In about four years, we are going to have to deal with it. The to-do list for my parents is short and sweet.
- Stop providing for their grown children
- Reduce their living expenses dramatically
- Get on a budget
- Funnel money into catch-up contributions
- Stay healthy
What Have I Done So Far?
During a recent visit, I gave my parents a copy of Dave Ramsey’s Total Money Makeover. I hope that they give it a good read and that they implement some of the teachings inside. There is a wealth of information in those pages that could have a transformative effect on their finances even in the few short years they have to prepare.
I have also worked with one of my Brothers in order to help straighten out his finances. I’ve attempted to get him on a budget and put him into a position to pay down his credit card debt.
Lastly, together with my fiancé, we have worked hard to establish a solid financial base to launch our lives. Here we sit, just a few years out of college with good jobs, well funded retirement accounts, and savings in the bank. We will be paying for our wedding ourselves without help from parents or family.
So we have a good start. But four years is not all that far off though.