September 2006


The idea of the “sandwich generation” has been around for over 20 years. Now it’s becoming a fact of life for more and more people. And if you happen to be the filling in the sandwich, you could be in for some hard choices in the near future.

We may not know exactly what kind of sandwich it is or how many layers it has, but it’s pretty clear that the so-called “sandwich generation” is getting increasing play in the media these days. The “sandwich” phenomenon only affects 4% of Canadians so far, but it’s expected to mushroom, and soon.
Three trends are contributing to the fact that a growing number of adults will soon be taking care of their aging parents and their dependent children – at the same time:
  • increased life expectancy;
  • couples having children later in life; and
  • adult children remaining financially dependent on their parents for longer.

Imagine a couple with three children still at home and four grandparents, all nearing eighty, who are losing their ability to live independently. Clearly, it’s no picnic.

A big mouthful for women
And it isn’t just a financial problem. When the health of aging parents begins to deteriorate, it can come as a mental and emotional shock for their children. In many cases, the adult children will need to rearrange their lives to accommodate their parents’ needs. There can also be legal hassles, related to a power of attorney or declaration of incapacity, for instance – or, more often, the need for these. And, of course, there may be a huge financial burden: the cost of elder care can be exorbitant.
Traditionally, the task of caring for aging parents in our society has been primarily shouldered by women. This still holds true today, with one major difference: most women now also work outside the home. Statistics show that one in five people caught in this kind of sandwich have had to adapt their schedules, and one in 10 has suffered income loss. Unfortunately, most of these are women.

Be prepared
Advance planning can help you survive the sandwich years much more easily. You need to take a good look at all three layers of the sandwich.

  • Aging parents (grandparents). As they become less self-sufficient, they will require an increasingly demanding level of care. Ideally, this would be provided by professionals, so that your own time with your parents would always be quality time. This kind of professional care doesn’t come cheap, of course. That’s why a good financial plan will often include long-term care insurance that can help ease the financial and psychological burden when the going gets tough.
  • Sandwich parents. About 70% of “sandwichers” report high levels of stress. Burn-out is common, so they need to be aware of their own physical and mental condition and needs, and know where to turn for support. Not only that, but the worst can happen to anyone: an unexpected stroke, heart attack, or cancer diagnosis can carry especially heavy consequences for people in the sandwich generation. Today there are financial solutions that can be included in your financial security plan to help you weather this kind of situation.
  • Children. Given the high cost of post-secondary education, it’s a good idea to put money into a registered education savings plan to finance future studies. (For more information, see “Learning to save, saving to learn” elsewhere in this issue.)

Preparing your financial plan

To all appearances, Canadians aren’t very well prepared for the challenges of the sandwich generation. We are still far behind France, for example, where an estimated 15% of people between the ages of 50 and 70 have long-term care insurance.

This might reflect the difficulty of broaching sensitive subjects such as your aging parents’ physical and mental health, finances, and estate. It can often be easier for an objective outsider to help get this dialogue going. For this reason, we are now very likely to be trained in this area, so you can rely on financial advisors for assistance.

It’s never too early to ask for advice… before you become the filling in the sandwich!

Some costs of caring for aging parents
Household help: up to $10/hour
Nursing: about $40/hour
Home care: up to $200/day
Drop-in centre: up to $50/day
Day centre: up to $50 and more/day
Residence: up to $6,000/month

Which part of the sandwich are you?
If you are near or in your sixties, you might still be the filling of your own sandwich while on the way to becoming the top slice of your children’s sandwich. Your financial planning should take this into account so that your children don’t find themselves in the same squeeze a few years down the road.