The Sandwich Generation: double financial burden

The term “sandwich generation” refers to the growing group of people who financially support both their parents and their children. This dual responsibility creates significant financial burdens and can have a major impact on the overall well-being of this group.

In 2019, there were 5.5 million people providing informal care in the Netherlands (SCP, 2019). This means that almost 1 in 3 people over the age of 16 were caring for others, in addition to their own lives. These figures do not include the ‘normal’ care for your own children. Understanding the unique challenges this group faces is crucial for employers to be able to properly support their employees.

Financial impact on this group

The sandwich generation constantly faces challenges in balancing work and private life. Childcare is expensive, so a parent might choose to work one day less to save on those costs. However, this naturally results in less salary and lower pension contributions. The same applies to taking time off for caregiving—something that will increasingly occur as the population ages. Data from AARP (June 2021) show that the average caregiver spends approximately €7,000 out of pocket annually to care for an elderly family member.

This has a significant impact on their financial well-being and their ability to balance daily expenses with long-term goals. In addition to the direct costs of care, one also experiences stress about saving for children's education, helping parents prepare for retirement, or managing their own finances.

Challenges

Due to the financial pressures, the sandwich generation often faces other challenges that can impact their well-being and productivity:

• Time management: Balancing work, childcare, and parental care requires meticulous planning and can often lead to a lack of personal time and rest.

• Burnout: The constant pressure to meet expectations at work, home and caregiving can lead to physical and emotional exhaustion, increasing the risk of burnout.

• Pension Preparation: Many in the sandwich generation wonder if they are saving enough for their own retirement, and if everything is in order once they leave the familiar environment of the workplace.

Support

Employers must adapt quickly to meet the growing needs of the sandwich generation. By offering Equip to all your employees, you solve many of these problems in one go. Equip offers direct help with personal financial planning, for now and in the future. In addition to the 1-on-1 conversations with a financial planner, we also offer insight into savings and investment goals, and an extensive knowledge base on various financial topics.

Conclusion

As financial pressures increase and the complexity of managing dual caregiving grows, it is crucial that employers and society at large recognize and support the unique needs of the sandwich generation. As an employer, providing access to reliable financial planning and education can help employees in the sandwich generation achieve greater financial stability and peace of mind.

Read more

Do you want to read more about the challenges your employees could face, such as the impact of and questions around the new Pension Act?