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Written by Cyndie Martini
on June 16, 2017

Everyone's family evolves with time. If you think about what your family looked like a decade ago, chances are you can name significant changes; maybe a baby was born, or a child began his or her career, or someone got married.

Sometimes, familial changes also mean taking on more financial responsibilities. Today, two phenomena are becoming more apparent to people across the country: adult children moving home, and aging parents needing a caregiver.

Combined, these two phenomena have led to another trend: middle-aged Americans caring for their parents and grown children at the same time, otherwise known as "the sandwich generation."

The sandwich generation

There are about 43.5 million unpaid or informal caregivers in the U.S. Most often, these caregivers are caring for one or two aging parents, according to the Family Caregiver Alliance. The cost to support an elderly parent is about $4,570 per year if the person lives nearby; $5,885 per year if he or she lives in the same house; or $8,728 per year for long-distance caregivers.

Meanwhile, a Pew Research Center survey found that 32.1 percent of adults ages 18 to 34 lived with their parents in 2014, the largest percentage in well over a century. Another survey by the organization found that one-seventh of respondents aged 40 to 59 have provided financial assistance to both an aging parent and either a minor child or grown adult child.

Many of these adults are happy with their decisions to help out their grown children or elderly parents. They love their family members and want to help them succeed and be healthy and happy. However, there are certainly a fair number of downsides to providing support to people in generations above and below them.

One downside of major concern is financial stability.

Financial services for sandwiched Americans

A study conducted by the Filene Institute found that close to 10 million Americans report feeling financially stressed due to providing for both their parents and children. Additionally, Pew's research found that 60 percent of respondents said they're able to meet all of their living expenses, but with little or no money left over for saving. Another 11 percent said they're not even able to pay for basic living expenses.

After conducting its extensive study on the sandwich generation, Filene found that there are many ways these consumers can be helped. Luckily, credit unions are in a position to help out immensely. However, not enough credit unions are taking the necessary steps to assist their members, Stephanie Galligan, a research manager at Filene Institute who lead the study, explained to Credit Union Times.

"The conversations and education we were finding was typically a list of to-dos and a message of 'put yourself first,'" Galligan said, according to Credit Union Times. "When you say to somebody to 'put yourself first' when it comes down to making sure that my mom has groceries or my child has groceries, or making sure that they have prescription medication – that's just not a message that's going to be helpful for them."

One useful tool credit unions can offer their members is a flexible savings account. A major concern for people who are supporting multiple family members is not being able to access funds when they're needed, Credit Union Times reported. Because of this, they avoid retirement plans and 529 college savings accounts, because once money goes into these funds, it's essentially locked in. A flexible savings account can provide similar benefits to retirement or college savings plans, but don't prevent the consumer from accessing funds in an emergency.

Another much-needed accommodation is increased education about medical financing. Many people are shocked as to how much health care costs skyrocket in old age. The average 65-year-old couple retiring in 2016 can expect to pay as much as  $260,000 throughout their retirement solely on health-related expenses, according to Fidelity Investments.

As an aging parent's health deteriorates, there will likely be more doctor visits, prescriptions and other medical expenses. Talk to your members about how much they can realistically expect to pay in health care costs. Then, help them formulate a plan to save for those future costs.

Serving the sandwich generation can be tricky. Many of these people are stressed and confused, knowing they need to care for their family members, but not knowing how to best do that while staying financially secure. It's important that credit unions identify their sandwich generation members and reach out to them with messaging that is catered to their unique situation.

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