Do You Have a Transition Plan?

Over the last few years, we’ve seen a growing trend of people caught between two sets of demands. On the one side, this group is focused on raising a family, building a career, and saving for retirement. But on the other side, this group is being asked to step in and help manage their parents’ affairs.

The situation has become common enough the group has earned a name, the Sandwich Generation. According to a 2013 Pew Research report, “around 42 percent of Gen Xers and 33 percent of baby boomers fit this profile.”

Even more concerning, a large number of “households are not prepared for retirement.” In 2014, the Federal Reserve conducted a survey that found “31 percent of non-retired respondents (including 19 percent of those aged 55 to 64) … don’t have any retirement savings or pension.”
Given those numbers, it’s not surprising that I’m hearing more often from clients about this issue and how they feel caught in the middle. The concerns vary, but they come back to a bigger question. How do we make this transition successfully?

Over the next few months, I’m going to share some best practices in this newsletter that specifically address this issue of transition. You may be the position of a parent needing more help from a child or a child being asked to do more for a parent.

Whatever your role, my goal is to help reduce the frustration and limit the guessing. These transition periods will happen for all us. And while we may be on one side at this point, there’s no reason to think we won’t end up on the other side … eventually.

Refusing to talk about the need for a transition plan remains a huge roadblock. No one likes to think about the day when roles will reverse. That said, these discussions are crucial. The sooner many of these issues can be addressed and planned for the better for everyone involved.
With that in mind, here are some of the specific situations I’ll address in future newsletters:

  • Establishing power of attorneys
  • Setting up estate plans
  • Creating and managing the transition plan

One of the most common scenarios I’m seeing is that people assume having the documentation (e.g., power of attorney) is enough. However, there’s yet to be a conversation about when and how things will transition. Stopping short of this conversation can create otherwise avoidable headaches. My goal is to save you from most, if not all, of those headaches.

We’re at an interesting moment in history. People are living longer. We’re having kids later. Sometimes those kids leave, then boomerang back. Some parents are discovering they may very well outlive their money. Whatever the situation, things have changed. My hope is that by the end of 2015 you’ll feel more confident about how to handle these changes.

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