Financial Tips for Caregivers of Parents and Children

Eric Mikkelson |

On one side, people in the sandwich generation provide some type of care to aging parents. It may include financial, emotional, or health-care help.

On the other side, sandwich generation members are taking care of young children or boomerang kids. Boomerang kids are adults who have left home and later returned for financial reasons.

Members of this generation—who are sometimes called “sandwichers”—have to deal with the dual challenges of addressing the needs and concerns of two very different groups of people.

One of their top concerns, especially as boomerang kids make their way back home, is managing the financial challenges of ensuring the needs of two generations are met.

Here are some tips to help members of the sandwich generation:

  1. Talk about finances

    Nearly a third of investors in the sandwich generation provide financial help to their parents, adult children, or both. More than half of investors who help adult family members believe it is impeding their abilities to generate adequate retirement savings. That comes to a fifth of all investors and nearly a quarter of non-retired investors.

    Having candid discussions with parents and adult children will help alleviate stress and enable you to plan ahead. Topics to include in planned discussions include insurance needs, health-care concerns, and financial plans. Holding discussions early in the process will allow you to avoid unpleasant surprises and better prepare for potential emergencies.

  2. Build your own retirement funds

    More than 40 million of the nation’s family caregivers are spending nearly 20% of their incomes on their loved ones. That comes to an average of $6,954 a year. That amount doesn’t factor in other financial liabilities, such as reduction in work hours and taking unpaid leave.

    “The strain can be enormous and may put their own financial and retirement security at risk,” said Nancy LeaMond, AARP’s chief advocacy and engagement officer.

    Women are more likely to see their plans for building retirement savings hampered by the demands of providing care for family members. Studies show that women can lose an estimated $324,044 in income over their lifetimes serving as caregivers compared to men’s $283,176.

    Caregivers have on average about $68,000 in their household retirement accounts; about 70% never seriously considered their finances prior to becoming caregivers.

    Financial analysts urge caregivers who are part of the sandwich generation to develop financial strategies to build retirement savings.

  3. Explore financial compensation programs

    More than 40 million caregivers in the U.S. are not being paid. And the number of people needing care is growing. Nearly 117 million are expected to need some form of care by 2020. While baby boomers comprise the largest number of caregivers, it’s not just baby boomers (8%) who are providing financial support to parents; younger people are quickly joining the ranks: 13% of Generation X and 19% of millennials provide some form of financial support to parents.

    Some states provide financial help for caregivers through Medicaid’s participant-directed service programs. Parents who are veterans and who are eligible for nursing home care may be eligible for additional assistance. For more information, visit or

If you would like to discuss other financial options as a caregiver, give us a call. We’re happy to talk.