Sandwich Generation

The Sandwich Generation
 
The phenomenon of ‘The Sandwich Generation’ is a generation of people, typically within their 30s-50s, who find themselves balancing the challenging act of bringing up their own children, whilst taking financial care of their ageing parents. This is a process that is not only emotionally burdensome but can be financially exhaustive.
 
The Sandwich Generation is a product of our ageing population, wherein more and more adults find themselves in a position to provide some level of care to an elderly parent, and children growing up in an age where it is very difficult to maintain financial independence. In this article, I hope to open up a discussion surrounding filial duty laws, of which many people are unaware, and provide advice on how to best tackle sandwiched financing.
 
In Canada, every province, with the exception of Alberta, is subject to filial duty laws which require adult children to provide financial support to a parent who may be dependent as a result of, old age, illness, or financial strain. In short, there exists a legal obligation of parental support. However, the likelihood of being sued for parental support is low as many children already support their parents through informal arrangements, and many dependent parents are able to secure funding through government support (specifically, through the Canadian Pension Plan and Old Age Security). Given the significant toll that paying for long-term facility care and/or various medical expenses can have on an individual’s long-term financial plan, it is always important to be prepared, regardless of your filial responsibility.
 
Set Ground Rules. This goes for both children and parents. If you take on the task of managing and paying your parents bills with their savings, lay down some rules to help your parents maintain some semblance of independence, should they want it. This could mean ceding certain financial decisions there way and keeping others up to your own discretion. While you may be able to cover the cost of your children’s expenses, it’s important for them to grow up managing their own money, however little it may be. This is an important skill to develop so they are able to learn financial independence early.
 
Start the conversation early. This is the most important piece of advice I can relay. The subject of caring for ageing parents is uncomfortable, delicate and is often a conversation your parents would prefer to avoid or ignore – this also includes the conversation of shared financial responsibility with any siblings you have. Laying down the groundwork before it becomes a necessity will save you stress and money but also provides your parents with an opportunity to express the level of independence they hope to maintain when/if the time comes. You and your parents will sacrifice much more if you leave the decisions of how much you intend to financially support, or where your parent[s] would like to reside until you are in the midst of a health scare, medical emergency or if a parent becomes cognitively impaired.
 
Be Transparent. Families tend to be secretive when it comes to one another’s finances. However, it is likely that you will be funding your parent’s medical and living expenses, both parties need to have full transparency into the financial health of the other. Having a firm understanding of just how financially independent or dependent your parent is or will be is essential to not only their financial well-being but yours too. Likewise, you need to be transparent about how much you are willing or able to financially support your parent in a time of need so that they can take the necessary precautions to protect themselves.
 
Secure Documents. In the event of an emergency, you will need access to your parent’s personal information. This can include, their tax broker, financial advisor, primary bank, income statements, insurance coverage, legal documents for a will or trust and even, their login IDs and passwords. This is hard information to find in a moment of stress, especially if a parent[s] is significantly debilitated.
 
Seek Financial Advice. As a member of The Sandwich Generation, you are likely tackling a marriage, career, family issues, managing children and a set[s] of ageing parents. This is a tall order for anyone. Seeking the necessary financial and/or legal counsel to navigate this messy situation will help you to allocate your finances appropriately and give you a realistic assessment of how this impacts your long-term financial plan. As a caretaker, supporting your parents shouldn’t imperil your own financial well-being – with the support of a professional advisor, you will find a solution that works to ensure the best possible outcome for both parties.
 
Make time for yourself. Don’t waste yourself completely in dealing with the care of your parents or children. This can lead you to make poor financial decisions in an attempt to get everything sorted as fast as possible. Remember that your well-being comes first, and in maintaining that precedent you will be able to better care for your loved ones. The guilt of not doing enough can eat away at you, but it’s best to do away with that feeling. Don’t be afraid to ask for help with finding good child care for your children or a caregiver to support a parent – it will put your mind at ease knowing there is someone well-intentioned and responsible looking after them.
 
The act of balancing your own financial needs, with the needs of your parents and children, is challenging. However, pre-planning is an invaluable solution. At times being a member of The Sandwich Generation can feel taxing and a relentless burden. With patience, open conversation and a shared set of expectations between all generations, it can also be an incredibly gratifying experience of supporting those who mean the most to you, in ways that will benefit them greatly. Whether that means, paying more for in-home care so your parent[s] can live their last years comfortably and with dignity, or sacrificing certain expenditures so your children can graduate with little to no student loans, it is a worthwhile and worthy cost.