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Unique estate planning concerns for the sandwich generation

Middle-aged adults can find themselves in a really difficult social situation. They may have young children, teenagers or college students who still depend on them while they also find themselves worrying about their parents’ health.

If your parents have serious medical issues that require frequent care or if they didn’t put money aside for retirement, you might need to help support them or even let them move into your house. Many working parents not only raise their own children but also support their parents to some degree.

Your daily schedule and budget are probably different than other people’s because of the extra demands on your resources. Your estate planning needs will be different, too.

Who can help your parents and kids if something happens to you?

It is common for most parents to leave resources for their children and their surviving spouse when they die. However, especially if your children are still young, you may need to consider the needs of your parents as well when planning.

Your children won’t be in a position to give your parents financial or practical support, and other family members who could potentially help your parents will likely have to divide their resources and attention if you named them as a guardian for your children.

You might want to name someone other than a sibling as the guardian for your children, such as one of your spouse’s family members, so that your immediate family can direct their attention to your parents.

Do you need to protect assets for your children?

Your children will need a guardian, and they will also need financial support. You may want to set aside accounts or assets for your children that their guardians can’t touch. Creating a trust can be a way to achieve this goal.

Such steps are particularly important if the parent serving as guardian to your children will also have some responsibility for the care of your parents. Given that you already understand the demands of the multi-generational caregiver’s position, it’s easy to see how assets left directly to your children could get used up before they become adults.

You need to look at practical, financial and familial situations carefully to create an estate plan that protects you, your children and your parents.

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