Advisor says it's vital to take as much financial burden off these clients as they'll allow
Advisors working with the sandwich generation need to help them learn how to take care of themselves before they look after other generations of loved ones, says one senior advisor.
“There always has been a sandwich generation with the parent in the middle who has young kids and aging parents,” John Cindric, a senior financial advisor with BlueShore Financial, told Wealth Professional. “But I’d say it’s tougher now.
“The difference is that I’d now call it a club sandwich generation because you’re talking about multiple layers of responsibilities, all competing for top spot. So, you, as the advisor, have to take as much financial burden off their back as they’ll give you. You have to be more proactive as an advisor to point out things that they haven’t just come to tell you.”
Looking at his experience at BlueShore, he said things are tougher now because the grandparent generation is living longer, and thus has more chance of dementia. Many of the parent generation are also helicopter parents, so are helping their kids even after they’ve left school or started out on their own.
“My sense is that the sandwich generation is stretched to the limit now because the aging demographic has really pulled it on one end and being helicopter parents has pulled it on the other,” said Cindric.
Caring for this generation can mean a lot of things – but it always means listening to what clients say about their lives and what they’re juggling, and developing a financial plan, he said, so “they can be proactive with the things they can control and have a plan for the things they can’t. That’s a great way to help them get peace of mind.”
“We have to get them to see things that they haven’t even thought of yet, and then it’ll be a lot more seamless,” said Cindric. “They may not even know they have a problem yet. So, we have to point those out to them. As advisors, I think that’s one of our main responsibilities.”
He noted this means ensuring they have all of ther financial basics in place, including emergency funds, wills and powers of attorney, and adequate insurance before they invest to build their wealth. But, it also means ensuring that they are saving for retirement and that helping the other generations isn’t eroding how they’re also going to be taking care of their own needs in the long run.
Caring for them can also mean noticing if they’re not taking care of their physical or mental health. So, he’ll suggest clients get some exercise – even walking consistently – or ensure they eat right.
“They have to put their oxygen masks on first if they want to help others or they’ll be useless,” he said.
Cindric said the advisors can also help with the other generations. They may show the parents how to reduce their taxes or talk to the children to reinforce good financial management messaging.
“I’ll have a quick live chat with them and try to relate to them as best I can as a friend of the family,” he said. “So, I’ve been used as a tool a lot of times to bring those hard conversations.”
He noted that the families who don’t communicate are the ones where things end up falling apart over time because they don’t talk a lot.
“The families who communicate about their finances are the ones who actually thrive because everyone understands their role,” said Cindric. “That’s absolutely the best flow, so communication is huge."