Your Finance: Surviving the 'sandwich' years

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Many Americans are caring for their children and Many Americans are caring for their children and their parents. Experts advise this sandwich generation to take a look at the big picture, and plan. Photo Credit: iStock

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Children of the baby boomers, the so-called sandwich generation, often support their parents as they age and their children as they enter college, with one eye on their own retirement funds.

More than 60 percent of young adults ages 19 to 22 receive financial help from their parents, according to a 2012 University of Michigan study. The tally comes to about $7,500 a year when help with rent, transportation and college tuition are included.

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As for elder care, more than 10 million Americans currently need long-term care, according to the Kaiser Family Foundation. Today's average annual cost of nursing home care is $72,000; assisted living, $38,000; and home health care services up to $30,000 a year, according to Kaiser Health News.

So how can you survive the sandwich years?

Find a financial adviser. Many sandwich adults who lack an adviser either think they don't have enough money or they can't afford it. But those who work with an adviser make big changes. According to the Principal Financial Group, 83 percent of workers who use a financial professional have an emergency fund, compared with 58 percent of workers who do not use one.

Do the crucial paperwork. Many documents that can ease sandwich years fears -- from a living will or power of attorney to trusts and a 529 education saving plan -- require busy adults to take time out and consider the big picture. You will want to include other professionals in your planning, such as a lawyer and/or accountant.

Talk to older parents to help them -- and you -- prepare. Many sandwich adults start retirement planning when their own parents are healthy and working, but things can change. You might not relish talking to Mom and Dad about worst-case scenarios. What if all of a sudden someone has a stroke or is diagnosed with Alzheimer's? With planning, you won't have to treat it like it's a fire drill.

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Have older kids help out in practical ways. We're not talking the odd baby-sitting gig. While one in eight kids now return home to live with parents after college, there's no reason why they can't contribute something to footing household expenses.

Balance short-term expenses with long-term goals. Many sandwich families get in a bind because they're so busy paying for everyday expenses that they allocate little or nothing to ease their biggest fiscal burdens. Big categories where people can cut back -- making room for college, retirement or health care planning -- include entertainment and dining out, new second cars and personal luxuries.

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