More than four-in-10 Americans who provide financial support for loved ones said it has made it harder to save for retirement, according to a new survey from MyGuidetoRetirement.org. Juggling the household costs of aging parents and adult children stretches budgets thin, while prices continue rising across the board for food, fuel, utilities, household goods and other expenses. Caregiving, retirement, and family budgets are all intertwined.
Insurance brokers are in a unique position to help their clients navigate paid leave, PTO and caregiving responsibilities.
By educating workers, employers and HR departments alike about paid leave entitlements, brokers can help ensure claimants get the time off and monetary benefits they deserve. This can reduce financial and emotional stress and, ultimately, lead to better workforce retention and employee satisfaction.
It all starts with understanding paid family and medical leave programs across the US and knowing the profiles of potential claimants so you can understand their needs.
Who Are Caregivers in the US?
The sandwich generation doesn’t describe people born in certain years, but wide swaths of people caring for older and younger members of their family at the same time.
Most people commonly think of the sandwich generation as members of Gen X, born between 1965 and 1980 and caught between helping aging parents and raising tweens, teenagers or young adults still living at home or going to college.
But millennials are actually the demographic most frequently responsible for financially supporting both a child and a parent at the same time, according to the survey.
Sandwich generation breakdown, by percentage:
- Millennials: 46%
- Gen Z: 39%
- Gen X: 35%
- Boomers: 20%
Eighty percent of survey respondents provided financial support to at least one person, while 38% supported both a child and a parent. That number jumped to 44% for men.
This shifts the perception of the “average caregiver.” It may not be a Gen X woman. It could be a younger woman or a man with younger children and older parents.
Providing Monetary Support vs. Care: The Gender Divide
While the Guide to Retirement survey reported that more men provide financial support as part of the sandwich generation, a Pew Research survey found that more women provide actual hands-on care to aging parents or to a spouse. The study found that 28% of women were caregivers for their parents or a partner compared to 23% of men.
More women (38% vs. 26%) also said caregiving had a negative effect on their physical health and their emotional well-being (47% vs. 30%).
Of the My Guide to Retirement survey respondents who said they are financially supporting a parent and child, nearly 30% said it had a “major” or “moderate” effect on their stress levels.
Nearly 25% said they stopped or reduced their retirement contributions, while 13% delayed starting their retirement contributions. Nearly three-quarters (24%) of supporters said that family obligations left them stressed about finances.
Providing financial support or physical care (or both) can impact working life, emotional well-being, and stress levels for employees of any gender. Caregiving leave in the form of Paid Family Leave (or PFML, as many states call it), combined with FMLA for job protection can help alleviate stress.
Knowing they have money coming in, flexibility in their schedule to take time off as needed, and job protection allows caregivers to focus on their loved ones of any age.
The Insurance Broker’s Role
As brokers build trust with their clients, it’s important to have the resources to help caregivers navigate the ever-changing landscape of PFML in their specific state.
You don’t have to be an expert in paid leave, though. The DBL Center is here as your disability, benefits, and leave expert to answer your questions.
Ancillary Benefits
It’s also a good idea to take a holistic approach regarding the role insurance plays in financial planning for workers. Ancillary benefits like dental and vision can provide tremendous value in terms of preventative and emergency care, taking one more financial worry off caregivers’ plates.
Voluntary worksite benefits add another level of protection if the employee gets hurt or ill off-the-job, often delivering partial salary replacement and hospital benefits.
Life Insurance
Finally, caregiving often brings workers face-to-face with their own mortality. Group Life / AD&D can deliver peace-of-mind that their loved ones will be cared for. Individual life insurance policies, often with executive carve-outs, can also help with retirement planning. Whole and universal life policies may offer cash value, opportunities to borrow against the policy, and potential interest and dividends.
Let The DBL Center Help You
Smart brokers can help younger generations balance their family needs against their own desire to save for retirement while helping older workers secure the benefits they need most at this time in their lives.
The DBL Center is here as your back-office, white-label, white-glove team to help.
