The sandwich generation is a term used to describe people who are caring for their children as well as their aging parents.
It can be a stressful and tiring position to be in, and can put strains on both your financial and emotional wellbeing.
It’s important to get your own finances in order first so that you can be in a better position to help aging parents or children who are ready to leave the nest.
Here are 6 financial strategies to help take the pressure off.
When looking after multiple generations, it can feel like you’re being pulled in several directions at once.
It’s important to take the time to make a plan and consider your own financial goals before making any big decisions. When you’ve made a plan, you can feel more confident moving forward.
Talking with a financial advisor can help you consider all your options and may even open doors you may not have considered.
As your parents get older, they may need assistance with managing their finances even if they don’t need direct financial support.
You should discuss things like their assets, debts and income sources, their living arrangement goals as they get older and estate options in case they can no longer manage their own affairs.
If you have siblings, it’s important to talk with them about how you will divide the responsibilities of caring for your parents.
Keep in mind that not all responsibilities are financial. If there is an imbalance in how much support each sibling provides, you may want to discuss the option of repayment using your parents estate if appropriate.
If you have adult children still living at home, consider ways they could help the household financially. Discuss the option of them paying some rent or covering some of the weekly household expenses.
This can be a good opportunity for them to learn financial and budgeting skills before moving out for the first time.
If you have two – or three – generations depending on you, it’s important to protect your income in case something should happen to you.
Your life and total and permanent disability insurance policy should be able to take care of your mortgage and any major life expenses to ensure you and/or your loved ones are looked after.
Trauma (or critical illness) insurance can provide a useful injection of money to pay for medical expenses and provide continuity for supporting loved ones while you recover.
If you’re not sure what coverage you need, speak with Lawrence Group about your priorities and ways to get the best coverage for your budget.
Research into government subsidies that you, your children or your parents may be eligible for. Centrelink is a good place to start for childcare subsidies, rent assistance and carer entitlements. Also check out My Aged Care website to apply for an aged care assessment.
It can feel overwhelming to be responsible for both your children and your parents and it’s important to reach out for help if you need it. Getting professional financial advice can help you feel more confident and at ease going into the future.
As always, the above information is general in nature and may not be suitable for your circumstances. Chat with the Lawrence Group team about how we can help.