Canadians are calling for debt forgiveness: Survey
When Catherine Ikeda-Blazys moved next door to her aging parents eight years ago, it was the perfect spot for her to care for them in their golden years.
Yet the Toronto-based executive assistant also had her own children, and as her parents' health deteriorated over time she felt the demands of caring for two generations grow.
Then after years of worsening dementia and glaucoma, her father died in December.
"It's overwhelming trying to manage it all," she said. "I'm maintaining two households."
Ikeda-Blazys is part of the so-called sandwich generation, a cohort of middle-aged adults caring for both children and aging parents.
It's a group that's long grappled with the conflicting demands of caring for children and seniors, a situation that can put a staggering emotional, physical and financial pressure on caregivers.
And with the additional strain of a pandemic, experts say professional advice on financial, retirement and estate planning strategies can help ease the burden on the sandwich generation.
As life expectancy increases and people have children later in life, the number of people pulled between caring for two generations is expected to increase.
In 2018, Statistics Canada reported that 700,000 Canadians were caring for their kids and parents, with the majority of those making up the sandwich generation women.
But observers say COVID-19 lockdowns and the rise of working from home has in some cases amplified the pressure.
And while sheltering in place with both children and elderly parents can be emotionally taxing, experts warn it can also take a financial toll.
Financial planners say the extra burden could even put retirement goals at risk.
"The stay-at-home order means children that normally would have been at school or away at university are home and now many elderly parents are moving in as an alternative to long-term care or require other financial support," said Sandra Henderson, regional president in the Toronto-area with BMO Private Wealth.
"The pandemic has exacerbated issues that probably were there in the past but are now even more pronounced."
For Ikeda-Blazys, her parents saved and invested wisely, leaving no financial burden for their children, she said.
But the 53-year-old said she's still juggling the demands of two households, including finding in-home caregivers, managing bill payments, grocery shopping, meal preparation, laundry, lawn care and shoveling.
That's on top of her full-time job, which she's now doing from home, while her 17-year-old daughter is enrolled in virtual learning and her son, 23, is at university.
"It does lessen the hardship that my parents don't require financial support, but it's still a tremendous amount of pressure," Ikeda-Blazys said. "It's a huge burden, but I can also rely on other family members for assistance and that helps a lot."
Yet many among the sandwich generation are contributing financially to their aging parents, while also supporting children.
Those costs may have increased during the pandemic, Henderson said, as some people may choose to move elderly parents into their homes and children who may have been at university may return home.
The financial repercussions include both out-of-pocket expenses, but also potentially a reduced income if caregivers need to decrease their paid work hours to manage the needs of both children and parents, she said.
"You also have things like renovations and increased costs for utilities," Henderson said. "And the fees for in-home support services have gone up dramatically."
The expenses can impact how much the sandwich generation can save for retirement or in some cases even push back their retirement altogether, she said.
"It's possible they may be pulling funds out of retirement savings or lines of credit to help supplement the cost of having kids come home and at the same time providing for elderly parents," Henderson said.
Meanwhile, many part-time retail and service sector jobs that help older children earn money or save for university have disappeared during COVID-19 lockdowns.
Statistics Canada said employment in January fell by 213,000 jobs, its lowest level since August. Those losses were entirely in part-time work and were concentrated in the Quebec and Ontario retail sectors, the federal agency said earlier this month.
The result could lead to higher financial needs among older children as aging parents require more assistance.
But financial, retirement and estate planning strategies can help relieve some of the pressure on the sandwich generation, Henderson said.
"We recommend people consider a couple of different scenarios," she said. "For example, if you have to support mom and dad for the next 15 years, which is usually the outer time limit, then what would you have to do."
Henderson said having a flexible and adaptable financial plan is critical, and that financial planners can help people work through multiple different scenarios.
"People need to look at their overall financial plan and their retirement goals and see if they are setting aside enough for retirement and how a change in circumstances like additional expenses for caring for elderly parents impacts those goals."