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The Sandwich Generation

Balancing kids, parents, and you. Care for yourself FIRST.


  • Determine how much you need to sustain your lifestyle first.

  • Save and invest now so your money can work better for you.

  • Protect your legacy with the necessary insurance coverages and an estate plan.


Are you feeling a financial tug from kids on one end and parents on the other? You’re in good company.

Welcome to the Sandwich Generation – a growing population of individuals who are caring for their children, aging parents, and, when they find time, themselves.

The saying, “You can’t care for others until you care for yourself,” couldn’t be more true. However, when you’re constantly being pulled in different directions, it is easy to forget about your own needs and goals.

Here are some ways for you to create a rock-solid financial plan for yourself so you can take better care of others.

The cost to be you

A good first step to establishing your financial plan is to understand what your expenses are. How much does it cost to be you?

Many shy away when they hear the term, “budget,” but it is so important to be intentional with your spending. If you don’t know where your money is going, then you can’t find easy, painless ways to save and know how much support you can realistically provide for your loved ones.

Factor in all your expenses - fixed and variable. Determine how much you should be spending and compare that to how much you actually spent. Don’t be surprised if these two numbers don’t match up – they often don’t. Some months will be better than others but account for those more expensive months when determining your monthly/annual budget.

Your spending figure drives many other financial targets - emergency savings, retirement savings, life insurance coverage, and even college funding needs - so setting this foundation is crucial.

Prioritize saving

Saving is a priority for everyone but especially those in the sandwich generation. On top of wanting to live a comfortable retirement, you also don’t want to be a financial burden to your children. The sooner you save and invest, the more power you’ll have behind your money.

Here are some considerations for prioritizing your savings:

Emergency Fund

Our typical cash target is between four and six months of your monthly spending needs depending on how quickly you can replenish the account and your household employment status. To get the most bang for your buck, all “parked” cash should be held in a high yield savings account.

Employer Sponsored Plans – 401(k)/403(b)

If your employer offers a 401(k) or 403(b), contribute as much as you can every year. In 2022, you can contribute up to $20,500, and $27,000 if you are age 50 and older. Many employers offer a match so, at the very least, make sure you are contributing enough to receive that free money.

Contribution amounts aside, work with a financial advisor to determine if you should be making Pre-Tax and/or Roth contributions. We find that many should be making at least partial Roth contributions.

Health Savings Accounts (HSAs)

One of the biggest retirement unknowns is health care. HSAs can act as a long-term care slush funds to help you reduce or avoid the need for long-term care insurance. With tax-deductible contributions, tax-deferred growth, and tax-free withdrawals for medical expenses, you may never pay taxes on these dollars.

If you are in a high deductible health plan that is HSA eligible, consider contributing up to the 2022 limits of $3,650 or $7,300, depending on your coverage status. There is also an additional $1,000 contribution allowed if you are 55 and older.

Back Door Roth 401(k) and Back Door Roth IRA

If you still have the capacity to save, prioritize tax-free savings opportunities. Some 401(k) Plans allow After-Tax contributions up to the total annual contribution limit of $61,000 ($67,500 if over 50). This After-Tax balance can then be converted to the Roth 401(k) for tax-free growth. While this is a great opportunity, careful planning is needed for tax minimization and to avoid overcontributing.

As a high-income earner, you can’t contribute directly to a Roth IRA, but you can consider a Back Door Roth IRA. If you don’t already have a Traditional IRA, then you can make a non-deductible IRA contribution of $6,000, or $7,000 if over 50, and convert that to a Roth IRA for tax-free growth.

Brokerage accounts

Once you have taken advantage of tax-deductible and tax-free opportunities, consider investing excess cash in a brokerage account. Because brokerage accounts are not retirement accounts, you can access these funds at any time without penalty. Brokerage accounts also allow for more favorable capital gains tax rates instead of ordinary income tax rates.

Protect what is yours

You have spent years building your nest egg, and now you need to protect it.

Life Insurance

This is a must if you are providing financial support for your loved ones. Several factors go into determining the right amount of coverage. At a high level, you want to consider:

Liabilities (debt)


Final Expenses


In most cases, term insurance is the most cost-effective and practical way to structure this coverage. You should know if your employer offers any life insurance coverage and the pitfalls that come with this coverage. Consider working with a fiduciary advisor who consults on insurance but does not sell policies.

Disability insurance

Regardless of age and health, anything can happen. Disability insurance will protect your income in the event of injury or illness. Five things to consider when evaluating a policy:



Benefit period

Elimination period

Definition of total disability

Employers often provide some sort of disability coverage, so be sure to check there first, and then evaluate your need for any additional coverage.

Estate plan

According to a recent survey, 67% of Americans have no estate plan. While it is a time and financial commitment, you can’t put a price on making sure your legacy lives on the way you intend it to.

A typical estate plan should consist of a will, powers of attorney for property and healthcare, and guardianship for any minors. For more complex situations, various trusts can be considered including a revocable living trust.

If your employer offers a group legal plan as a benefit, this can be a very cost-effective way to get an estate plan in place.


Navigating the competing financial priorities of children, parents, and yourself can be stressful. That is why your financial security should be the #1 priority. You only have one shot at getting it right and setting up your family for success, so take the time to understand your financial needs first and establish a rock-solid financial plan. By securing yourself first, you will feel much more confident about providing extra support for those that need you most.

Katie Blechschmidt, CFP®

Director of Client Success

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