America’s ‘sandwich generation’ is taking care of young kids, aging parents, themselves — but at a serious cost to their financial future. Here’s the math and how to adjust

What is the sandwich generation

The sandwich generation refers to people who are stuck in the middle — providing for both aging parents and children. This group is growing as life expectancies increase and people have children later in life.

According to Pew Research, 23% of all U.S. adults have at least one parent aged 65 or older while supporting either a child under 18 or an adult child financially. People in their 40s are the most likely to be part of the sandwich generation, with 54% supporting both a child and a living parent over 65.

Both men and women can find themselves in this position, though adults with college degrees are slightly more likely to have obligations to multiple generations at once.

Unfortunately, research from the Journal of the American Geriatrics Society revealed that:

• 23.5% of sandwich-generation caregivers reported substantial financial difficulties.
• 44.1% reported significant emotional stress.
• Members of this group reported higher levels of caregiver role overload.

According to a survey by Wakefield Research and Otsuka America Pharmaceutical showed that 72% of sandwich-generation members have had to cut back on necessities — such as food or medical care — or have been forced to dip into their retirement or personal savings to cover expenses.

For the Gomezes, this was exactly the case. They were struggling to contribute to their retirement accounts and would be saddled with paying off their daughter’s student loans until the husband turned 71. The impact on their retirement is profound.

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What to do if you're a member of the sandwich generation

If you are a member of the sandwich generation, you need to find ways to reduce both the financial and emotional strain — while still preparing for your own future so you don't become a burden on your own kids one day.

The best way to do that is to set financial boundaries. Figure out how much you need to save each month to reach your retirement target and prioritize that over everything except essential expenses. This may mean limiting or stopping contributions to your children’s college fund. While they can borrow for school, you cannot borrow for retirement.

After deciding how much you can afford to spend on helping your family, have an open discussion about what you are and are not willing to do. If you are supporting adult children, consider setting a cutoff date for financial aid so they have time to plan accordingly.

For aging parents, explore benefit programs like Medicaid or other assistance options to help ease the financial burden.

Ultimately, being in the sandwich generation is difficult, but you are not alone. The important thing is to set limits on financial support so you can continue investing in your own future. And just as importantly, make sure you have emotional support so you don’t become burned out, overwhelmed and unable to care for yourself or your loved ones.