The Sandwich Generation II
By Christopher W. Pinkham
When I used the title “Sandwich Generation” in the last issue, I received some very interesting comments. Some 20-somethings had not a clue as to why they were a piece of this puzzle. They optimistically believe that taking care of their parents won’t be their problem and that, most likely, the `rents have ample money to care for their own needs and leave a bundle for that next generation. Some 30- and 40-somethings were skeptical. Their parents were living well, had their health and were beginning to be a valuable resource as babysitters and large gift providers. They might be stretched to their financial limits, but their youngsters had lower financial needs, tuition seemed to be far in the future, and besides, the lease for the van had just one year to go! My 50-something peers all said the same thing: you’re right and what are you doing about it?
I actually have an answer for my peers. First, we all agree that everything seems to change when a health problem occurs to one or both parents (sometimes around age 70). Initially, the parent has an ailment, diagnosis or an accident and then the medical expenses that had not been part of their daily focus are suddenly a major problem. Then the endless doctor appointments, the costs for prescriptions or the physical therapy all replace earlier cost centers such as utilities, food and travel. Life turns inward and the options of spending money on home maintenance, social activities and lifestyle all take hits.
Second, the fear of these and future health expenses oftentimes outlives the actual costs when parents live in their home. But all bets are off when they must move to either a residential or assisted-care facility. “What if we don’t have the money? Will we have to choose between food and prescription refills?” All this dominates the discussions unless some planning has begun years before – planning that includes a plan for continuing health coverage and, today, the purchase of long-term care insurance.
LTC is a product that not only reduces the worry factor but delivers a dollar value to soften the upward spike of these inevitable health care costs. A basic policy provides partial coverage for medical assistance and more complex products cover much of the residential care and can even add inflation protection. While all have a price tag attached, the premium will look terrific compared to the real costs. Plus, if the long-term care product is purchased at an early age and because the premium adjusts for the age of the insured (what a surprise), it is quite reasonable!
And finally, there is another benefit. The middle of the sandwich gets real peace of mind.
Christopher W. Pinkham is president of the Maine Association of Community Banks.