Valley First

Under Pressure: The Sandwich Generation

The importance of financial planning is ever more important for sandwich generation

More and more working Canadians are finding themselves having to take care of both their children and elderly parents. This is a growing demographic group, which experts have dubbed the sandwich generation. Made up of people in their 40s and 50s who should be taking the last few laps before retirement, this demographic is facing increasing financial pressures as they juggle careers, family commitments and personal well-being.

According to research published with Statistics Canada, 30% of Canadian professionals are balancing childcare and caring for older family members while trying to further their own careers and get ahead financially. The added personal and monetary responsibility can have very real short and long-term effects.

Growing multi-generational care costs can hinder financial plans and prevent even the best savers from getting ahead financially. Families caring for both children and older relatives have greater day-to-day expenses and more spent today means less to put away for tomorrow. Balancing childcare, elderly care, mortgage, education costs is challenging. Over time this can easily translate into reduced savings or retirement income in the future.

Additional studies also revealed employees who are caregivers experience high levels of stress due to their juggling responsibilities and that 20% of them have had to turn down a promotion because they were unable to take on additional responsibilities at work. A situation that can have a long-term effect on earning potential.

Given the sandwich generation will continue to grow as the population ages and as Generation Xers delay starting families, it is important for people to be aware of additional family and financial responsibilities they may face.

Not surprisingly, figures from one study also showed 40% of survey respondents reported high levels of overload both at work and at home. According to Valley First Branch Manager Chris Mowat, having a solid financial plan in place can help prevent financial headaches from adding to the stress.

“The key for those sandwiched between caring for their own children and their parents is planning,” says Mowat. “Financial institutions like Valley First can help members develop a financial plan tailored to their unique needs that’ll take care of themselves and their families.”

Growing wealth comes from developing and sticking to a financial plan. It takes discipline, but knowledge and planning are the best remedies for preventing financial stress.

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