A growing number of “sandwiched” baby boomers are finding it necessary to delay retirement as they strain their financial resources to support children and elderly parents, USA Today reports.
The Pew Research Center defines the “sandwich generation” as adults who have a parent age 65 or older and who are either raising a minor child or supporting a grown child.
Many people who fit that criteria are assisting both the older and younger generations, and the financial burdens associated with caring for multiple generations of family members are mounting, says Pew.
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According to Pew, only 28% the sandwich generation who provide support to parents and children say they live comfortably. By comparison 41% of adults who aren't aiding elderly parents say they live comfortably.
And most of the sandwich generation who provide multiple generation support are middle aged, with 71% between ages 41 and 59, and an additional 10% age 60 or older, notes Pew.
People in that age range should be focused on retirement. Many are already in fragile situation as the average person has only about $81,000 of retirement savings,
USA Today says Fidelity data show.
Many are already expecting to retire late, according to a Fidelity survey, which revealed 50% of respondents are not expecting to retire at age 65, and 24% of that group don't see retirement at age 70 as being likely either.
The sandwich conundrum only aggravates matters.
“People who want to retire have to delay that,” Lanta Evans-Motte, financial adviser at Raymond James in Beltsville, Maryland, told USA Today.
“This is during the time when they are at peak earnings and can put away the most money. But it's also when a lot of them are having to turn around and spend a lot of money and time taking care of their parents, their children and in some cases, their grandchildren,” she explained.
The financial burden catches many people off guard. A lot of baby boomers are not only providing multiple generation support but it's increasingly common that the grown children and elderly parents move in, Scott Hanson, principal with Hanson McClain Investment Advisors told USA Today.
When that happens costs go up even when it isn't expected, he says.
Financial experts say it’s important to address the sandwich issue head on. That means even if there's a financial plan it should be updated to address new realities.
People have to continuously update their retirement calculations, Jim Stoops, vice president and financial consultant with Charles Schwab told USA Today.
“You can't let aiding others destroy your own retirement and your own future,” said Katherine Dean, head of wealth planning at Wells Fargo Private Bank. “You have to make those decisions in concert with your own goals. Beware of the emotional aspects. It can take a toll,” she added.
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