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The Sandwich Generation
Money Minute
It’s a challenge to balance the needs of three generations.

Most of us are familiar with the challenges of trying to save for our children’s education expenses as well as saving for our own retirement. But there’s a generation of Americans who are finding themselves also taking care of their aging parents. This group has been dubbed the sandwich generation, and it’s expected to grow as seniors are increasingly living longer.

And not surprisingly, caring for both your children and parents isn’t easy. To say the least, it can be a challenge for your finances.

According to a study from Mass Mutual, 49% of those in the sandwich generation help to manage their parent’s finances. However, 31% go further and say they’re actually helping to pay for some of their parents’ bills. Obviously, when you’re caring for your children and your parents, that doesn’t leave a lot for you to save for your own retirement. So what to do?

First, try not to tap your own retirement accounts to pay for other expenses. Although it can be tempting to use your 401k to pay for your kid’s education, remember that your children can apply for scholarships and student loans. There’s no such thing as a retirement loan.

Second, if possible, talk to your parents sooner rather than later about their finances and plans for long-term care. This can be a hard topic so you’ll want to approach it carefully, but having this talk can get the ball rolling on planning out the future. And if you have siblings, include them in the planning too. As a family, you can prepare together.

And finally, don’t forget to take care of your own retirement. Keep in mind that if your parents live into their 90s, chances are, you will too. So you’ll want to have enough retirement savings, accordingly.

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