What can advisors do to help clients managing elder care, childcare costs

Cassandra Cross is watching the struggles of the sandwich generation firsthand. The Calgary based Wealth Advisor and Client Relationship Manager with Nicola Wealth has seen her clients feeling the strain of the ongoing Alberta teachers’ strike, and the additional pressures of childcare that puts on working parents. She’s seen, too, how those same parents are bearing the emotional, physical, and financial costs of their parents’ aging.

So many Canadians are now stuck in between caring for their parents and caring for their children. Cross believes that a structured financial plan and clear expectations around both sets of caregiving responsibilities can help Canadians manage this pressure.

“The invisible load, refers not only to financial strain, but then also what I'm seeing is the emotional and logistical labour of balancing children, aging parents, and demanding careers,” Cross says. “I would say that probably a quarter of the clients that I work with from the age of mid-40s to mid-60s, and are now supporting both children and parents. I think that's really a demographic where that reality is reshaping how we're thinking about wealth planning when I'm working with my clients.”

Cross’ approach now hinges on cross-generational planning. She strives to facilitate open family conversations where grandparents, parents, and sometimes children are brought in with the advisor as a neutral moderator. In that role, Cross can help those families define clear expectations around what they want from one another and how they plan to pay for those expectations. She finds that by asking specific questions and maintaining a neutral stance, she can help clients achieve that clarity in what might sometimes be a fraught and emotionally difficult conversation.

One key touchstone that Cross uses in these conversations is the financial plan. She notes the benefits of her firm’s model in helping with cost management. Nicola Wealth, she explains, prioritizes cash flow in their investments. When modelling out caregiving plans that might need to last for decades, the cash flow provided by many of these investments can prove valuable. She will stress-test the plan, too, finding areas where liquidity might be required and whether using something like a caregiving reserve, insurance proceeds, or even a holding company could help with any short-term cash crunch.

Beyond the financial preparedness that this kind of planning offers to the sandwich generation, Cross says it helps create a sense of emotional buy in across the generations of a family. Teenage and adult children can be brought into these conversations and given tools to gain greater financial literacy. Topics of wealth creation, accumulation, and preservation can all serve to create a more knowledgeable and empowered client family. That more knowledgeable family, in turn, may feel less overwhelmed by the issues and costs that come when they need to bear caregiving costs. It also serves to proactively lay the groundwork for a family to respond to crises when they eventually occur.

Cross notes that often the worst-case scenario for the sandwich generation is when expectations around caregiving are not clearly defined. Responsibilities will often emerge in reaction to crisis and leave those bearing them more burdened. While planning for these situations may involve uncomfortable conversations, she argues that proactive planning creates capacity down the road. To demonstrate that, Cross will share her own family’s story, where her mother was placed in control of her grandparents’ affairs when they faced a sudden illness. She saw how being forced to react created more discomfort and difficulty than having a plan in place.

For advisors working to build these plans with client families, Cross emphasizes both the importance of working with every stakeholder as well as identifying those key people who may face the greatest burden of caregiving. She notes that these roles tend to fall to women in the family, and that identifying who those primary caregivers may be and what they need is crucial to building a complete plan. She believes that while this work helping families plan for the pressures of caregiving may be challenging, it is also some of the most rewarding work advisors can do.

“Our role as advisors is really to take care of our clients and their families. One of the most rewarding things I've experienced in my practice is when I do work with multiple generations of a family,” Cross says. “Planning for the sandwich generation is not just a spreadsheet exercise. It’s really about creating the capacity for them and providing them with support and confidence. That’s where I find the most satisfaction working with my clients.”