Should the “sandwich generation” let their kids struggle?

If you’ve been on the internet for more than three weeks, you’ve likely come across the phrase “Okay, Boomer.” We’ve been blaming baby boomers for a lot of stuff lately, but the truth is, they might be keeping entire families afloat. 

Driving the news: Many middle-aged Canadians feel squeezed as financial obligations to parents and kids become increasingly expensive, with some dipping into their retirement savings (or just sticking around at work longer).

  • A recent poll found that 75% of Canadians aged 55 to 64 have less than $100,000 set aside for retirement—a far cry from the estimated $1.7 million they’ll likely need to live comfortably well into their golden years.

  • Parents might also feel obligated to help their children navigate financial challenges, trying to keep them from going into student debt by funding their education in full or helping them get into the housing market with a fat down payment. 

Why it’s happening: It’s hard to say no to the people you love, even if it’s to your own detriment. Baby boomers hope the generosity they show their children will be repaid once they reach old age.

  • When you support three generations from one household income, saving for retirement becomes nearly impossible.

Why it matters: Many of us think our children should have a better life than we did, but with the cost of living rapidly outpacing wage gains for younger generations, the burden of making that happen has now shifted directly to parents. 

  • Though most experts agree that handing everything to someone on a silver platter isn’t the best way to prepare them for success, and letting your kids struggle a bit is a critical aspect of growing up.

Bottom line: If you’re stuck in a money sandwich, it’s time to talk about bread with your family. It’s uncomfortable, of course, but if your teenager realizes their grandparent’s care costs the same as the designer bag they want, it might help them better understand the family’s financial situation.