A recent study from the University of Michigan reveals a worrisome trend for the children of Baby Boomers. According to the study (and this recent article) “more than 60 percent of young adults ages 19-22 receive financial help from their parents,” a tally which comes to “about $7,500 a year when help with rent, transportation and college tuition are included.” This by itself wouldn’t be so disturbing, were in not for the fact that there are also “more than 10 million Americans [who] currently need long-term care;” care that their adult children will have to contribute to financially.
The good news is that this doesn’t come as much of a surprise to the children of Baby Boomers who are beginning to take seriously the title of “the sandwich generation.” Many of these sandwich generation adults can see what’s coming in the next decade or so; they’re looking ahead, asking questions, and planning for the future. If you are one of these sandwich generation adults, our firm can help you get answers to your questions and take steps to prepare for what may lie ahead.
The article mentioned above advises that some of the most helpful things you can do to prepare are to:
1. Get the help of a financial and/or legal advisor. People who work with advisors are the ones who end up making the changes that need to be made, instead of just talking about them. An advisor can help you understand a complicated situation, explore your options (including lesser known options you may not be aware of), and most importantly, implement your decisions.
2. Don’t drag your feet when it comes to paperwork and documentation. “Many documents that can ease sandwich years fears – from a living will or power of attorney to trusts and a 529 education saving plan – require busy adults to take time out and consider the big picture.” Waiting won’t make it any easier, and may result in certain opportunities passing you by.
3. Talk to your family members. First and foremost, have a conversation with your parents. Find out what plans (if any) they’ve already made. They might have long-term care insurance already, or estate planning documents in place, both of which can remove a huge burden from your shoulders. Secondly, talk to your children. Kids living at home can contribute—even if it’s just a little—to expenses, or help provide physical care for ailing grandparents.