facebook twitter instagram linkedin google youtube vimeo tumblr yelp rss email podcast blog external search brokercheck brokercheck
%POST_TITLE% Thumbnail

Retired Military Finances 101: How to Financially Care For You, Your Kids & Your Parents

Insurance Managing Your Finances

Since 1994, the fourth Sunday in July has been celebrated as National Parents Day. This holiday was established with the purpose of “recognizing, uplifting, and supporting the role of parents in bringing up their children.”1 As a parent, you have one of the most important jobs in the world - raising and encouraging the next generation. Some parents, however, may find that they’re sandwiched between raising their kids and caring for older loved ones. Aptly named the “sandwich generation,” those in their 40s, 50s and 60s may be feeling the pressure of being stuck in the middle. In fact, a recent study suggests almost half (47 percent) of adults are a part of the sandwich generation.2  

If you’re a loving parent and adult child caring for parents of your own, how do you strike a balance between your financial wellbeing, your child’s needs and your parents?

Understanding Your Situation

You may feel compelled to provide care for your aging parents in addition to raising children, meaning you don’t mind the added responsibility. But stretching yourself financially between saving for college, preparing for your own retirement and covering your parents’ costs can be a tough situation to find yourself in. And depending on how much care your kids or parents require, your income stream could be affected.

That’s why protecting your own financial standings when caring for loved ones should remain top of mind. Finding that balance is, of course, easier said than done. But here are a few ways to ease the financial toll of caring for elderly parents while being a parent of your own.

Tip #1: Build Your Support Network

Sometimes people feel like they need to shoulder all of the responsibility in caring for elderly parents. You may be the oldest sibling in your family, considered the most responsible or simply live the closest to Mom and Dad. But if you find that the caretaking is becoming too much for one person, it may be time to have a transparent and honest conversation with your siblings or other family members. They may not know just how much added responsibility you’ve taken on and they may be just as eager to help.

Family members aside, it can be beneficial to gather a team of financial professionals as well. Your financial advisor, for example, can help keep your financial priorities top of mind, while also developing a game plan for managing your caretaker responsibilities. Other professionals you may want to engage with could include an accountant, estate planning attorney, insurance agent and college planning professional.

Tip #2: Keep Your Savings Goals in Mind

Remember, you can not help others financially or otherwise if your own financial standings are in jeopardy. Trying to put a kid through college while caring for aging parents can drain your savings quickly if you aren’t careful. That’s why making your own financial goals a priority isn’t easy, but important.

In fact, staying focused on your long-term financial goals (like retirement) can actually be thought of as a way to protect your own kids. Emptying your retirement accounts early, or neglecting to save enough for retirement, could leave you in a bad spot later in life. In turn, your children may find themselves providing for you financially while they’re raising kids of their own. Remembering to prioritize your long-term goals now can help set you, your children and your grandchildren up for a less stressful financial future.

Tip #3: Create Boundaries For Your Children

If your kids are college-age or older, you may be able to set financial limitations with them. This won’t be easy, but it may be necessary in certain circumstances. If they don’t already work, encourage them to find a part-time job. And if they’re already earning an income, help your kids develop a budget and become as self-sufficient as possible. You may even find that when presented with the opportunity, your kids are able to rise to the challenge and learn good money habits from being less financially dependent on their parents.

If your kids are younger, start working with them to understand the importance of saving versus spending. That way, when they’re old enough to start earning money of their own, they’ll be well-prepared to work toward financial independence from you.

Tip #4: Consider Investing in a Long-Term Care Policy 

A long-term care insurance policy can cover a number of expenses not typically covered by health insurance. This could include assistance with activities of daily living (ADLs) such as bathing, dressing and eating. Care may be provided wherever your parents are living - at home, in a nursing facility or adult daycare.

A long-term care policy is typically bought when individuals are younger than 60, as a policy can’t be obtained once a person has been diagnosed with certain debilitating conditions or diseases. Depending on your parents’ health, you may still have time to purchase a policy. If not, you may want to look into obtaining a policy for you and your spouse if you’re concerned about your own future care needs. Keep in mind that if you or a parent(s) are a disabled veteran you may have some long-term care options with the VA.  

Protecting yourself, your parents and your kids requires careful strategizing, discipline and planning. It’s a balancing act, but it’s one you don’t have to perform alone. Your financial professional can help steer you in the right direction while keeping your financial goals a priority.


If you found this article useful, you might like the following blog posts:

Is VA Long-Term Care a Replacement for Long-Term Care Insurance?


SBP and Long-Term Care Insurance


Why Female Military Officers and Spouses Need to Plan for Long-Term Care


  1. https://nationaltoday.com/national-parents-day/
  2. http://www.pewsocialtrends.org/2013/01/30/the-sandwich-generation/#a-profile-of-the-sandwich-generation

This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.


Disclaimer
Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by C.L. Sheldon & Company, LLC ), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. C.L. Sheldon & Company, LLC does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to C.L. Sheldon & Company, LLC website or incorporated herein, and C.L. Sheldon & Company, LLC takes no responsibility therefore. All such information is provided solely for convenience, educational, and informational purposes only and all users thereof should be guided accordingly. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from C.L. Sheldon & Company, LLC . To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. C.L. Sheldon & Company, LLC is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the C.L. Sheldon & Company, LLC ’s current written disclosure statement discussing our advisory services and fees is available for review upon request. DISCLAIMER OF TAX ADVICE: Any discussion contained herein cannot be considered to be tax advice. Actual tax advice would require a detailed and careful analysis of the facts and applicable law, which we expect would be time consuming and costly. We have not made and have not been asked to make that type of analysis in connection with any advice given in this blog post. As a result, we are required to advise you that any Federal tax advice rendered in this blog is not intended or written to be used and cannot be used for the purpose of avoiding penalties that may be imposed by the IRS. In the event you would like us to perform the type of analysis that is necessary for us to provide an opinion, that does not require the above disclaimer, as always, please feel free to contact us.