The so-called “sandwich generation” is being slammed from the responsibilities of aging family members while balancing their own careers and family responsibilities. This isn’t a new problem. Attempting to simultaneously caring for aging parents and raising – or still supporting – their own children places physical, emotional and even financial pressure on the caregiver and their family.

Texas Tech University professor Charlene Kalenkoski had studied this problem. Many would find it difficult to imagine refusing to care for an aging Mom or Dad, or even an Aunt or Uncle, when they’re in need, However the study says it’s important to understand the toll such caretaking may have before agreeing to take it on.

“Americans are not planning well for retirement – indeed, retirees often find themselves in informal caregiving roles they may not have prepared for,” said Kalenkoski, director of the Retirement Planning and Living Research Initiative in the Texas Tech University Department of Personal Financial Planning.

“The goal of this research is to examine how caregiving affects the well-being of retirees and show what the negative effects are. In particular, if people do not want to suffer a reduction in their own well-being that will occur once they take on a caregiving role, they may want to purchase long-term-care insurance or make other financial arrangements long before such care is needed.”

Many American families are dealing with this issue every day. The US Department of Health and Human Services says when a person reaches the age of 65 they have a 7 in 10 chance of needing some type of long-term care service or support. Many people fail to plan in advance for the financial costs and burdens that come from longevity. Long-Term Care needs often don’t hit the radar screen until it is too late. This places the family into crisis management. Communication with family members make this crisis easier to deal with.

“People need to talk to their relatives early and often about what sort of informal care they expect when they age, because people often have unmet expectations,” Kalenkoski said. “They also may want to inform their children that they do not want to take on a heavy caregiving load with respect to their grandchildren.”

Those to whom the caregiving role falls need to understand how it may affect their own well-being so that, if they choose, they can plan ahead for other types of care.

“People need to be informed about other options besides informal caregiving, such as Long-Term Care Insurance. Waiting and seeing what happens – an approach taken by many – is probably not wise,” Kalenkoski said. “Society seems to think that because retirees are not working, they should not experience a reduction in well-being when they give care. However, this research shows that this is not the case.”

The American Association for Long-Term Care Insurance (AALTCI), a national consumer education and advocacy group, says those with Long-Term Care policies are receiving huge benefits. In 2017 alone, just the top insurance companies paid over $9.2 Billion in benefits. Most claims start with care at home, which allows people to delay or avoid a nursing home facility. It also reduces the burdens placed on family members.

“There is one thing that really stands out when I speak with family members as I assist them with a claim. They tell me they have been given the gift of time. They always say their parent’s Long-Term Care policy allowed them the time to just be family. Yes, they also talk about the money which allows for choice of quality care, but it is all about family,” said Matt McCann who has spent 20 years as a specialist in this area.

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To avoid this crisis on family members requires advance planning and the understanding of how aging will impact you, your family as well as savings and lifestyle. If you wait until a problem exists, you will have less choices.  Your only options will be using your family as caregivers or paying for care which significantly impacts assets and lifestyle. Neither of these options are fair to your family or yourself.

“There are many affordable options available to consumers, especially when they plan in their 40s and 50s. Today’s Long-Term Care Insurance is both very affordable and rate stable. Shared benefits for spouses provide flexibility. 45 states offer special partnership plans which provide additional asset protection. Most plans provide professional case management which eases the burden on loved ones. Asset based plans provide both a long-term care benefit as well as a death benefit. This is really a key part of retirement planning,” McCann said.

Planning is more than just Long-Term Care Insurance. Be sure to have a power of attorney in place. A power of attorney gives a named family member or friend the ability to step in and make decisions regarding your health when you are unable to do so.

A medical power-of-attorney can also express your wishes on how to extend life … or not. It gives doctors and hospitals the ability to discuss your private health situation with a named person, so they can help make decisions if you are not able to do so.

A power-of-attorney for finances allows a person to act on your behalf with financial decisions when you are unable to do so. They are separate documents which you should put in place well before retirement.

The sandwich generation, your family, deserves better. However, research shows failing to plan has significant consequences.  

LTC NEWS offers several resources to start your research on Long-Term Care planning. Find the cost of long-term care services in your state as well as the availability of tax incentives, partnership plans and more: https://www.ltcnews.com/resources/state-information.

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