9 Things You May Be Getting Wrong About the Sandwich Generation

The Sandwich Generation refers to people, typically in their 40s and 50s, who are “sandwiched” between caring for children and older parents. The term was first applied to Baby Boomers in the early 1980s but now encompasses a growing number of Gen Xers and Millennials.

But are our assumptions about the challenges facing today’s Sandwich Generation accurate? To find out, Athene recently quizzed people about the finances and experiences of sandwiched adults. (Before reading on, take the quiz yourself.)

As it turns out, many of us are getting it wrong*: 

1. The Sandwich Generation might be bigger than you think. 

Some quiz takers believe that about one-third of adults in their 40s are part of the Sandwich Generation. In reality, about 55% of fortysomethings are in the generational squeeze (1). 

2. You may be underestimating the drain on sandwiched adults’ finances.

More than one-third of respondents didn’t realize that nearly 90% of sandwiched adults were paying daily living expenses, such as groceries or cell phone bills, for a loved one (2).

Also, 45% of parents financially support an adult child, according to Savings.com, at an average cost of $1,440 per month (3). But 8 out of 10 quiz respondents undervalued that monthly assistance, some by as much as $960.

Caregiving, too, can take a financial toll. Caregivers spend an average of $7,240 out-of-pocket yearly on routine expenses for a loved one, according to AARP (4). But 46% of quiz respondents underestimated these costs, typically by $3,515. 

Consider these “4 financial tips for the sandwich generation.” 

3. More kids boomerang than you might expect.

It’s not unusual these days for young adults to return home and live with their parents. Even so, 28% of quiz takers believed that one-quarter of young adults — ages 18 to 29 — were living with one or both parents. The reality is that half of young adults were living with a parent in 2022 according to Pew Research Center, up from 38% in 2000 (5).

4. Sandwiched adults are postponing retirement in higher numbers than you might realize.

More than 4 out of 10 quiz respondents underestimated the number of sandwiched adults who have put off retirement to support adult children, an older parent or other loved one.

An earlier Athene report found that 47% of sandwiched adults said they delayed retirement to support a family member. And a similar percentage said they dipped into their retirement savings to aid relatives (6). 

Use the “Map your clear path to retirement“ planning worksheet to run the numbers on your current retirement plan.

5. You may be overlooking a tax break for sandwiched adults.

Claiming dependents on your federal tax return can help save you money. But 1 out of 4 respondents believed that only children could be claimed as a dependent. However, if certain criteria are met, even a parent can qualify as a dependent. Sandwiched adults can check with their tax professional about any tax breaks they may qualify for. 

6. You might confuse key estate documents. 

Only about 10% of respondents were unaware of advanced directives and how they can help caregivers. Two common directives are a medical power of attorney that authorizes, say, an adult child to make healthcare decisions on a parent’s behalf and a living will that lets family and doctors know what life-sustaining measures a parent wants — or doesn’t want. Many states combine these two documents into one.  

7. You may overestimate Medicare’s coverage. 

More than 25% of respondents think at least one medical need is covered by Medicare that isn’t. Original Medicare — hospital insurance (Part A) and medical insurance (Part B) — doesn’t cover several key needs: long-term care, hearing aids, and routine dental and vision care.

Medicare beneficiaries either pay out-of-pocket for these items or buy separate insurance coverage to help with the bills. 

8. You might underestimate the power of an annuity to help protect retirement savings. 

An annuity can provide a retiree with a lifetime stream of income, helping to supplement other retirement savings. But the majority of respondents believe that 80% of sandwiched adults with an annuity still had their retirement sidetracked by helping out family. In reality, 70% of sandwiched adults with an annuity say their retirement remains on track (7).  

9. Sandwiched adults are happy. 

An overwhelming 8 out of 10 respondents believe that sandwiched adults have a higher degree of unhappiness than other adults. But the Pew Research Center found that despite the financial and time pressures, sandwiched adults are more likely to say they’re very satisfied with their family life than adults who aren't in that situation (8).

What will make you happy in retirement? Find out your retirement personality on the “What’s Your More?” quiz.

* Respondents took the quiz between August and October 2023. Percentages in the article are based on the number of respondents answering the specific question, which varied.

(1) More than half of Americans in their 40s are ‘sandwiched’ between an aging parent and their own children, Pew Research Center, 2022.

(2) Sandwich Generation, Insights, Analytics and Experience, Athene, 2023

(3) 45 Percent of Parents Still Cover Costs for Their Adult Children, Savings.com, March 2023.

(4) Caregiving Can Be Costly—Even Financially, AARP, June 2021.

(5) Americans more likely to say it’s a bad thing than a good thing that more young adults live with their parents, Pew Research Center, August 2022.

(6) Sandwich Generation, Insights, Analytics and Experience, Athene, 2023

(7) Ibid.

(8) More than half of Americans in their 40s are ‘sandwiched’ between an aging parent and their own children, Pew Research Center, 2022.