Finances & Advice Multigenerational households squeeze retirement goals

Multigenerational households squeeze retirement goals

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As a late-to-the-plate boomer parent of a third-grader, I accepted a while ago that my retirement would be delayed.

That conscious choice, though, does not obviate two other common occurrences under the heading of, “Mom, I’m home!” The dual-edged economics of either adult children coming back into the fold, or caring for an aging parent, can delay or postpone indefinitely the pie-in-the-sky supposed goal to retire and … travel, read, knit, play more golf, play more tennis, fill in the blank.

Nuclear families in the United States are reverting to extended families of olden days. The Census Bureau has defined multigenerational households as “family households consisting of three or more generations.” While those types of U.S. households only account for 5.6 percent, or just over 4.3 million households, the trend is on the rise.

“And the decision often appears to be not purely voluntary,” said Paula Span in a recent New York Times review of Katie Hafner’s book, “Mother Daughter Me.”

When moving into my quiet Maine neighborhood more than a decade ago, adult children were living with their parents in several houses. Now, three- and four-generation families are beginning to take root. High costs of housing, situational challenges, and new immigrants who live with their relatives account for more than 10,000 multigenerational Maine households, and around 30 percent of those have the head of the household living with both a parent and a child, and nearly 70 percent living with a child and their grandchild. My neighbors are part of the elite 1.4 percent of Mainers housing four generations under one roof.

“I get to take care of my mom, help my dad and see my grandkids grow up,” said one Mainer. “Sometimes it is hard, but, you know, it takes a village,” she laughed.

Whether the kids are back or you are back to help your mom or dad, your own retirement may not be in the cards. Adult children contribute nearly a third of their income to help financially support their parents’ needs from food to prescriptions. To finance this addition, savings and retirement funds can be drained, jeopardizing boomers’ own finances and potentially putting themselves into the hands of their own children in the future. Talking to your accountant or a financial planner about the consequences of dipping early into your retirement can help inform and guide you, but it is difficult to say, “No,” when caring for an aging parent or buying lunchbox goodies for school-bound grandchildren.

Boomers, now into their first couple of years of “retirement age,” according to Social Security, increasingly choose to go back to work. Elizabeth Isele, co-founder of SeniorEntrepreneurshipWorks.org., says, “Rarely, if ever, have people thought of ‘aging’ as a time of ‘opportunity,’ but, with the advent of 20-30 additional years of life, today’s seniors are determined to add meaningful life to those years, to remain self-reliant, and to give back to their communities and their world.”

While millions of seniors are continuing to work full and part time, Isele notes new research released by Civic Ventures and funded by MetLife Foundation shows that approximately 25 million people – one in four Americans ages 44 to 70 – are interested in starting businesses or nonprofit ventures in the next five to 10 years. Isele, herself a serial entrepreneur, has just launched another business at age 70. She commutes between Washington, D.C., and South Portland, relishing the opportunity to see her children and grandchildren grow up, and continually taps into their technological expertise to advance her –and one day, their – businesses.

Hafner’s book does not pretend to be a manual on how to meld multigenerations harmoniously.

“I was guided by a combination of love, protectiveness, and, as I would eventually come to see, magical thinking,” she said.

Magical and creative financial thinking may also be in the cards for these blended, extended families.

For a closer look at what boomers should be looking out for with their aging parents, visit http://www.alzheimerhelp.org/images/stories/pdf/aging-parent-checklist.pdf.

Kimberly L. Volk of Portland is a Certified Trust and Financial Advisor at Aurora Financial Group, an investment advisory and planning company in Portland. She has more than 20 years of experience in managing finances for individuals, their partners and their families.

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