By 2030, all Baby Boomers will be over the age of 65 and make up 21% of the U.S. population. By 2060, that percentage is projected to go up to 25%. For more and more aging Americans, the question has become: Where will I live? This growing cohort creates an increasing burden on both the healthcare infrastructure and on housing for the elderly, with not enough assisted-living or in-home caregiving options available to accommodate the vast number of seniors who need it. This limited access to care is now causing many older adults to move in with their children.
Enter the sandwich generation.
Currently, close to a quarter of American adults between the ages of 35 and 54 are caring for both a child/children under the age of 18 and a parent over the age of 65. They're called the sandwich generation, and according to a study conducted by the Journal of the American Geriatrics Society, they're more than twice as likely to report financial difficulty than their peers without children who are caring for an aging parent.
It's also likely that adults in this generation are experiencing the most stressful time of life, balancing career, household management, and all the tasks that come with raising kids — transportation, cooking, errand running, homework support, activities, and more. There are money stressors, too. Providing for themselves, their children, and their parents can create a financial burden that hurts all three generations.
For insurance providers, the sandwich generation represents a strong potential growth market. Providers can educate them on the many benefits that can help ease their burden both now and in the future. According to experts, they're underinsured. Here's why:
1. Many don't understand the true impact of losing a family member, because they haven't experienced it yet.
Because of their relative youth and the fact that at least one parent is still alive, the sandwich generation isn't completely aware of all the costs that come with a death, studies find. Beyond the funeral and burial or cremation costs, there may also be medical bills and estate lawyer fees to pay. Forbes states that, "Overall, the average direct costs related to the death of a loved one can reach $20,000. That's before factoring in lost income from taking time off or healthcare costs required to manage health and mental health symptoms."
Insurance providers can help by explaining that there are costs beyond medical bills and lawyer fees. The sandwich generation may be faced with expenses that come after the dust has settled, like lost income due to bereavement leave or the emotional repercussions of grief. A study from Empathy found, "Without proper support, the emotional toll of grief — compounded by the demands of daily life and the logistics of loss — can erode both mental and physical health. In our survey, members of the sandwich generation reported the most emotional and physical symptoms." The right life insurance plan can help offset these costs.
2. The sandwich generation may overestimate what life insurance costs.
While a life insurance policy may seem like an unnecessary expense in the tumult of daily life, it can be a huge source of financial relief when measured against the toll of caring for a loved one — even before they pass.
Empathy's survey shows that many millennials and Gen-Xers "...reported using their own financial resources to pay death-related bills; 42% used their own credit cards or checking accounts and 36% used their savings. Just 14% were able to tap into funds specifically designed for these purposes, such as life insurance or last arrangements insurance."
Providers looking to grow business in this demographic can point out the necessity of protecting one's savings, credit score, and future financial security. For the relatively affordable cost of a life insurance policy, the sandwichers can get support to help manage an aging parent's medical bills, funeral and burial or cremation costs, and legal fees, leaving breathing room to help with other expenses: like taking time off from work to give care and building savings for their children. It can be a way to avoid the massive financial toll that comes with a parent's passing and help provide for the survivors they leave behind.
3. Americans are afraid to talk about death.
For the sandwich generation to lay a solid financial foundation, they have to be willing to have clear, honest conversations with their family members. But, according to Psychology Today, around 80% of Americans have a birth plan in place, while only 22% have a death plan. This has been linked to our growing physical separation from death. Until the early 1900s, people usually died at home, surrounded by loved ones. Today, most natural deaths take place in hospitals. As a result, our fears around death have grown and have made necessary conversations more difficult to initiate.
Honesty around death is essential to coping with it. Insurance providers can encourage adult caregivers to prioritize open dialogue, expressing their love and concern for their parents. Insurance providers can also help explain the many ways a policy can ease some of the fears associated with death and offer stability for those left behind.
There are a number of life insurance plans designed to help the sandwich generation cover the costs associated with caregiving and raising a family at the same time, and insurance experts can help them find the right solution for each person's situation and budget. The time to start planning is now.
Footnotes
1 Vespa, Jonathan. “The Graying of America: More Older Adults Than Kids by 2035.” United States Census Bureau. Census.gov. March 13, 2018. https://www.census.gov/library/stories/2018/03/graying-america.html
2 ”Sandwich Generation Study Shows Challenges of Caring for Both Kids and Aging Parents.” University of Michigan Department of Psychiatry. December 9, 2022. /https://medicine.umich.edu/dept/psychiatry/news/archive/202212/%E2%80%9Csandwich-generation%E2%80%9D-study-shows-challenges-caring-both-kids-aging-parents
3 Lei, Lianlian; Leggett, Amanda N.; Maust, Donovan T. “A National Profile of Sandwich Generation Caregivers Providing Care to Both Older Adults and Children.” Journal of American Geriatrics Society. November 25, 2022. https://agsjournals.onlinelibrary.wiley.com/doi/10.1111/jgs.18138
4 Rupe, Susan. ”Why the Sandwich Generation May Be Underinsured.” InsuranceNewsnet.com July 28, 2025. https://insurancenewsnet.com/innarticle/why-the-sandwich-generation-may-be-underinsured
5 Gordon, Deb. “Dying Can Cost Loved Ones $20,000 Before Lost Wages and Worse Health, New Report Says.” Forbes.com. January 31, 2023. https://www.forbes.com/sites/debgordon/2023/01/31/dying-can-cost-loved-ones-20000-before-lost-wages-and-worse-health-new-report-says/
6”The Grief Tax: Empathy’s Annual Research Report.” Empathy.com. Jan 31, 2023 https://www.empathy.com/thegrieftax
7 Sarazin, Stephanie. The Reality of Mortality: Why We Aren't Talking About Death: Storytelling Can Flip the Script On Death and Dying Narratives—Including Yours.” PsychologyToday.com. October 27, 2023. https://www.psychologytoday.com/us/blog/soulbroken/202310/the-reality-of-mortality-why-we-arent-talking-about-death
8 Ashcroft, Rachel. “Americans Are Bad at Talking About Death, and It's Hurting the Environment.” TheWeek.com. April 7, 2022 https://theweek.com/feature/opinion/1012220/talking-about-death-is-good-for-us-and-the-environment
