‘Sandwich Generation’ Plus ‘Dual-Retirement Phenomena’

No doubt, you have heard of the "sandwich generation" but what about the "dual-retirement phenomena"?

The greying of much of the population and the rapidly-expanding ranks of retirees are throwing up new challenges as well as new expressions to describe our changing lifestyles.

Members of the "sandwich generation" – typically in their forties, fifties or sixties – are still supporting their children, trying to save for own retirement yet also spending much time, and possibly money, helping care for their ageing parents.

In other words, they are "sandwiched" between the needs of their children and their parents – while attempting to look after their own interests.

According to a recent article in The New York Times – Two generations, retired and together – the "dual-retirement phenomena" occurs when two generations of the same family are in retirement.

There are, of course, similarities between these two intergenerational circumstances: A major cause of both is greater longevity and both can test family relationships – financially and emotionally.

Indeed, the "sandwich generation" and the "dual-retirement phenomena" summarise two of the countless social impacts of an ageing population, as broadly discussed in the 2015 intergenerational report.

Phyllis Moen, a sociological professor at the University of Minnesota, is quoted by The New York Times as saying that it is "historically unprecedented where you have older people and their still-older parents". And families would have to "figure out those intergenerational relationships."

Case studies in this article include a 99-year-old mother and her 71 year-old son, a retired data analyst, as well as a 62-year-old retired schoolteacher and her 88-year-old father.

In short, the younger retirees are dealing with both the challenges (and extra freedoms) of their own retirement while trying to care for the increasing needs of their very old and often frail parents.

It is worth revisiting a short article, Your investing life: Helping aging parents, published in late 2013 by Vanguard in the US. It suggests how adult children can help their ageing parents while not neglecting their own needs.

"If your parents are under financial constraints, you may want to tap into your retirement savings to help them," Vanguard’s specialists write. "That’s an admirable instinct, but one with potential long-term financial consequences for you and your own children. Consider any such move carefully before you act."

And perhaps try to talk to your ageing parent or parents about money while respecting their financial boundaries, the specialists add. Ideally, these conversations should cover such issues as whether they have enough money to meet their living expenses and whether any "unfortunate financial surprises" are on the horizon.

A practical way that adult children can assist is by ensuring that their ageing parents are receiving all of their government entitlements.

Individuals in the "sandwich generation" – who may also be experiencing or expect to experience the "dual-retirement phenomena" – may benefit from consulting a skilled financial planner about the best way to handle their inter-generational financial challenges.

Robin Bowerman is Head of Market Strategy and Communication, Vanguard Australia. As a renowned market commentator and editor Robin has spent more than two decades writing about all things investment.