Sandwichers Caught Between Supporting Adult Children and Retirement Plans

More than four-in-ten so-called “sandwich generation” parents (41%) continue to provide at least some financial support to their young adult children, according to the 2010 Families & Money Survey by Charles Schwab & Co., Inc.

Baby Boomer parents have often been referred to as the “sandwich generation,” reflecting the combined pressures of raising children and caring for aging parents, yet the Schwab survey found that the most significant layers of the sandwich seem to be the pressures of retirement planning combined with helping adult children, according to a press release.

Not surprisingly, the most common worries for mid-life parents are not being able to retire (29%), outliving their retirement money (22%), not saving enough (22%), and that their children won’t become financially independent (11%). 

When choosing between priorities, parents report that saving for retirement (56%) and helping their children financially (44%) are near-equivalent priorities. 

Of the 85% that say they are at least a little worried about their financial future, only 6% of respondents provide financial support to both an adult child and an aging parent, and only 1% worries about supporting their own parents. 

Among those worried about their financial future, fewer women than men are worried about outliving their retirement money (19% vs. 26%).

Economic Environment Prompts Change

Two-thirds of people surveyed (66%) believe there was a silver lining to the recent economic recession. Top lessons learned include “learning to live within my means” (49%) and being “much more involved now with my finances” (43%).  

Among the top behavioral changes people made were:

  • being more cautious about credit card use (62%);
  • asking more questions when it comes to financial decisions (59%);
  • reviewing financial statements more closely (59%);
  • reading the fine print in financial documents more closely (54%); and
  • talking to kids more about money management (54%).

Schwab said women are more likely than men to have made recent, positive changes in their financial behaviors and habits, including talking to their children more about money management (59% vs. 47%, respectively). Men are more likely than women to say there hasn’t been any silver lining to the economic recession (38% vs. 29%).

Lessons for the Younger Generation 

According to the Schwab survey, parents of 20-somethings recognize that they could perhaps have done more to foster their children’s independence by teaching them about saving and budgeting and not helping them as much financially. While 57% of parents see themselves as a “good financial role model to their children,” they also admit that their children’s spending habits don’t necessarily reflect this perception.  

Respondents said the top three areas of money management where their children need to improve are:

  • how to stick to a budget and live within their means (48%);
  • how to save money (42%); and
  • how to invest wisely (33%).

Respondents also worry their kids will repeat some of their own financial missteps, most notably not starting to save for retirement early enough (43%), not saving money for emergencies (42%), and carrying credit card debt from month to month (30%).  

Parents cite college debt (32%) and unemployment (31%) as top reasons their children are relying on them more. However, they also believe that some contributing financial pressures fall squarely within the kids’ control, such as overspending (25%) and consumer debt (19%).  

Interestingly, despite the ongoing financial support they provide their adult children, nearly half of survey respondents (49%) believe their kids will eventually be even more successful than they themselves are today, and another third (33%) believe their kids will be equally as successful. More women than men believe their kids’ ultimate financial success will surpass their own (56% vs. 42%, respectively), while more men than women believe their kids will be less successful (23% vs. 14%).  

The survey found that parents whose children regularly did more household chores growing up are more likely to view their young adult children as “very financially responsible” (53%) as compared to those whose children did fewer or no household chores (46% and 39%, respectively). Parents of children who didn’t do any regular chores also see themselves as having been poorer financial role models.  

The 2010 Families & Money survey was conducted by Lieberman Research Worldwide on behalf of Charles Schwab & Co., Inc. in February 2010. The nationally representative online survey polled 1,000 people who are parents of at least one child, ages 23-28, and who have at least one living parent. 

A detailed fact sheet is available at