If you are part of the so-called “Sandwich Generation,” finding yourself the filling between your own children and your aging parents, you’ll understand how the peanut butter in your PBJ feels.
An increasing number of Americans find themselves in this position, and are learning firsthand how the pressure from both sides affects their personal finances. The dueling responsibilities can create financial uncertainties that working couples didn’t foresee.
The Pew Research Center reports that in 2005, some 45 percent of Americans had a parent 65 or older and were still supporting a child. By 2012, the figure was up two percentage points to 47 percent. For those actually contributing to the support of parents, the financial stresses were showing up in the quality of their economic situations.
As the life expectancy in America climbs, experts suggest that one in seven adults in the working years will be proving for both children and one or two parents. When the elderly develop health problems that go beyond the ability of families to cope at home, the expenses can skyrocket. The average cost of a semiprivate nursing home room is $80,300 per year. That scenario can be devastating to a family still involved in child-rearing.
Planning ahead helps, although the variables make such planning imprecise. Trying how to anticipate costs associated with an aging parent at the same college bills are building on the other end is a challenge, but it is better to make a stab at planning than to be caught unawares. Consider such factors as the current health status of the parent or parents, how much they have in assets, whether they still own a home or other financial resources and how they have managed their finances in the past as you try to plan.
Sacrificing the needs of your own family to make provision for parents may be shortsighted. Dipping into your retirement assets to care for them may lead to long-term problems in the future. If you have grown children thrown into the mix and they want to come home to live temporarily – a scenario that is more and more common – be certain they understand they have to make a contribution to the finances. On the other hand, carefully assess the real needs of parents before crippling yourself financially to see them through. Your own retirement should remain Goal No. 1. Weighing the relative needs of children who are still gaining education and getting established in jobs with the needs of the elderly can be very tricky, but it sometimes has to be done. Look for help from government social services, your church, siblings, veterans’ organizations and other sources before dipping too far into your own pockets.
One useful resource for information on long-term care is longtermcare.gov. Eldercare.gov will access the National Association for Area Agencies on Aging. It provides for information on local resources such as transportation, in-home services and housing for the elderly.
If you have a parent living in your home for at least six months, you may be able to claim a dependent-care credit on your income taxes.
Expect an emotional journey and keep in mind that some day you’ll cease to be the peanut butter and take your place as the end piece of bread.
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