FINANCIAL FOCUS – How Can The Sandwich Generation Relieve Financial Stress?

financial-stress-

Come by April 15th and find out how to maximize your workday, work smarter not harder, and reduce or eliminate common distractions and time wasters in our free workshop.

Don’t worry too much if you haven’t heard, but April is National Stress Awareness Month. Of course, stress can present emotional and physical challenges to all of us, but if you belong to the “sandwich generation” – that is, you may be caring for aging parents while still supporting your own children – you may be facing some financial stress as well. What can you do to relieve it?

For one thing, be aware that you’re certainly not alone. About one in seven middle-aged adults is providing financial support to both an aging parent and a child, according to the Pew Research Center.

Still, knowing that you have plenty of company won’t provide you with solutions for your own situation. So consider the following:

 

  • Suggest “downsizing.” Are your parents still paying a costly mortgage on a house that’s now too big for them? You might want to encourage them to think about downsizing. They may be emotionally attached to their home, but they might benefit substantially if they moved someplace that’s less expensive.

 

  • Talk to parents about their income sources. Are your parents maximizing their Social Security payments? Are they following a sensible withdrawal strategy for their IRA, 401(k) or other retirement accounts? You may want to recommend that they work with a qualified financial professional.

 

  • Discuss all legal arrangements. Be aware of your parents’ estate plans and the status of important legal documents – will, living trust, power of attorney, health care directive, and so on. When the time arises for any of these arrangements to take effect, you don’t want to face any unpleasant – and possibly costly – surprises.

 

  • Find out about health care. Try to learn about your parents’ health insurance coverage. And have they done anything to protect themselves from the potentially catastrophic costs of long-term care, such as an extended nursing home stay? You may not be able to do a great deal for them in these areas, but at the least, you may be able to get them to take some positive action on their own behalf.

 

  • Don’t ignore your own retirement savings. Even if you can afford to provide some financial support to your parents, don’t shortchange yourself when it comes to yourown retirement savings. You don’t get a “do-over” when it comes to putting away money for retirement, so contribute as much as you can afford to your IRA and your 401(k) or other employer-sponsored retirement plan.

 

  • Prioritize your investment choices.If you would like to help your children go to college, you might want to consider a college savings vehicle. Still, you may need to prioritize your investments. After all, your children will likely have a variety of options – such as loans and scholarships – to help them pay for school, and they may also be able to reduce costs substantially by going to a community college their first two years. But you are basically “up against the clock” when it comes to saving for retirement, so you’ll want to take that into account when allocating your investment dollars.

 

Belonging to the sandwich generation can certainly produce feelings of anxiety. But by following the above suggestions, you may be able to reduce some of this stress. And by doing so, you can help your parents, your children – and yourself.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

marques-young

FINANCIAL FOCUS – Time for Some Financial Spring Cleaning

spring-cleaning-for-your-finances1

Spring is in the air, even if it’s not quite there on the calendar. This year, as you shake off the cobwebs from winter and start tidying up around your home and yard, why not also do some financial spring cleaning?

Actually, you can apply several traditional spring cleaning techniques to your financial situation. Here are a few ideas:

  • Look for damage. Damage to your home’s siding, shingles and foundation can eventually degrade the structure of your home. Your investment portfolio is also a structure of a sort, and it, too, can be damaged. Specifically, you may have deliberately constructed your portfolio with an investment mix – stocks, fixed-income vehicles, cash instruments, etc. – that’s appropriate for your goals and risk tolerance. But over time, your portfolio can evolve in unexpected ways. For example, your stocks may have grown so much in value that they now take up a larger percentage of your holdings than you had intended, possibly subjecting you to a higher degree of risk. If this happens, you may need to rebalance your portfolio.
  • Get rid of “clutter.” As you look around your home, do you see three mops or four nonfunctional televisions or a stack of magazines from the 1990s? If these items no longer have value, you could get rid of them and clear up some living space. As an investor, you also might have “clutter” – in the form of investments that no longer meet your needs. If you sold these investments, you could use the proceeds to fill gaps in your portfolio.
  • Consolidate. Do you keep your lawnmower in a shed, a rake in your garage, and your gardening tools in the basement? When working on your outdoor tasks, you might find it more efficient to have all these items in one location. You could also have your investments scattered about – an IRA here, a new 401(k) there, and an older 401(k) someplace else. But if you consolidated all your investments in one place, you might cut down on paperwork and fees, and you wouldn’t risk losing track of an asset (which actually happens more than you might think). Even more importantly, when you have all your investments with one provider, you’ll be better positioned to follow a single, centralized investment strategy.
  • Prepare for a rainy day. As part of your outdoor spring cleaning, you may want to look at your gutters and downspouts to make sure they are clear and in good repair, so that they can move rainwater away from your home. Your financial goals need protection, too, so you’ll want to ensure you have adequate life and disability insurance.
  • Seal leaks. In your home inspection this spring, you may want to investigate doors and windows for leaks and drafts. Your investment portfolio might have some “leaks” also. Are investment-related taxes siphoning off more of your earnings than you realize? A financial professional can offer you recommendations for appropriate tax-advantaged investments.

This spring, when you’re cleaning your physical surroundings, take some time to also tidy up your financial environment. You may be pleased with the results.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

marques-young