Balancing Act: Finances in the Sandwich Generation Years

June 23, 2025

If you’re in your 40s and find yourself juggling the needs of your children and aging parents, you’re not alone. More than half of Americans in this age group are in the sandwich generation. This means they care for and support both younger and older family members.

But this isn’t limited to just one age bracket. Many in their 30s and 50s also face similar pressures, making this life stage both common and challenging.

Between school schedules, doctor appointments, college planning, and concerns about long-term care, life can feel overwhelming. But there are proactive steps you can take to bring order to the chaos—and even build financial strength along the way.

What Does It Mean to Be in the Sandwich Generation?

The sandwich generation includes adults who support their children and care for their aging parents at the same time. While this often peaks in your 40s, people of all ages can find themselves in this dual-support role. With many demands on your time, energy, and money, it’s easy to put your long-term plans, like retirement, on hold.

Yet, protecting your future is essential. Taking care of yourself financially will ultimately help you continue to be there for those who depend on you.

1. Prioritizing Your Retirement Goals

Generation X—those born between 1965 and 1980—is currently leading the sandwich generation. Yet, despite their experience in the workforce, many Gen Xers feel the least secure about their retirement readiness. Confidence improves slightly among millennials, but across the board, there’s room for improvement.

The good news? Small steps can make a big difference.

A consistent savings habit, even modest at first, can reduce financial anxiety and create a greater sense of control. In a study about women investors, those who saved only 2% of their income felt much more stress. This was compared to those who saved 10–14%. The clear takeaway: increasing your savings—even incrementally—can improve both your outlook and your future.

Tips to enhance retirement preparedness:

●     Start where you are and build from there. Increasing contributions by just 1% each year can lead to meaningful growth over time.

●     Maximize tax-advantaged accounts like IRAs and 401(k)s. Traditional accounts defer taxes, while Roth accounts allow for tax-free withdrawals in retirement.

●     Don’t overlook catch-up contributions. If you're 50 or older, you can contribute more—$1,000 extra to an IRA and up to $7,500 more to your 401(k) in 2025. Those aged 60–63 can contribute an additional $11,500 to their 401(k) for that year.

●     Consider your investment mix. Stocks have historically offered higher returns over time than bonds or cash. While market risk exists, aligning your investments with your time horizon and risk tolerance is essential.

Delaying retirement even slightly can also make a significant difference in your savings and future benefits.

2. Tackling the Rising Costs of Higher Education

College tuition continues to climb, putting additional pressure on families. For the 2024–2025 school year, average tuition and fees at a public four-year college were $11,610 for in-state students. For out-of-state students, the cost was nearly three times higher.

To manage this cost:

●     Start saving early and regularly, even in small amounts.

●     Consider a 529 college savings plan, which offers tax-deferred growth and tax-free withdrawals when used for qualified education expenses.

●     Be honest with your children about what your family can afford and encourage them to explore scholarships, grants, and work-study programs.

●     Prioritize retirement over education funding. While students have multiple options for financing school, your retirement does not come with a loan program. Contribute enough to your retirement accounts to receive any employer match before allocating funds to college savings.

3. Supporting Aging Parents with Compassion and Planning

As life expectancy increases, many adults in the sandwich generation are stepping into caregiver roles. Whether it’s coordinating medical care, handling daily tasks, or managing finances, the responsibilities can be demanding.

To navigate this:

●     Start conversations early. Ask your parents about their wishes, financial situation, and legal documents like power of attorney or healthcare directives before a crisis arises.

●     Plan for care options in advance. Explore costs for in-home assistance, assisted living, or long-term care insurance.

●     Review workplace benefits. Some employers offer caregiving resources, flexible hours, or dependent care FSAs that can help offset some of the costs and challenges.

Embracing the “Messy Middle” with Confidence

The sandwich generation years can feel like a tough balancing act. However, they are also a chance to build a stronger and more secure financial future. By being intentional with your planning, having open conversations with loved ones, and working with a financial advisor, you can navigate this life stage with clarity and purpose.

Remember, you don’t have to do it all on your own. A trusted financial advisor can help you create a plan for your whole family. This way, you won't give up on your long-term goals.

Sources:

https://www.fidelity.com/learning-center/personal-finance/sandwich-generation

Disclosure:

This information is an overview and should not be considered as specific guidance or recommendations for any individual or business.

This material is provided as a courtesy and for educational purposes only.

These are the views of the author, not the named Representative or Advisory Services Network, LLC, and should not be construed as investment advice. Neither the named Representative nor Advisory Services Network, LLC gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your Financial Advisor for further information.