Sandwich generation growth threatens retirement savings

A growing number of Americans are joining the ‘sandwich generation,’ providing simultaneous financial or caregiving support to aging parents and their own children. Research from the Pew Research Center indicates that 25% of American adults now fall into this category, a rise from 23% in 2021. The pressure is most acute for those in their 40s, with 54% reporting they are supporting both generations.

This demographic shift carries significant economic implications. A study from the Center for Retirement Research suggests that as retirees increasingly rely on adult children to make ends meet, the next generation may face diminished retirement savings. Every dollar diverted to assist parents is a dollar that cannot be invested in the adult child's own future. This trend is particularly noted among Black and Hispanic populations, who often report lower total wealth and higher rates of providing parental assistance.

In states like New York, which has a rapidly aging population, these pressures are expected to intensify. Projections suggest that by 2030, more than a quarter of New York residents will be 60 or older, potentially increasing the strain on families, employers, and long-term care systems.