Money in the Middle

Sandwich Generation Talking About Money Up, Down and Across Generations

Archive for December 2009

5 Sandwich Generation Money Lessons from 2009

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2009 – almost over. Whew!  So, let’s take a look back at money lessons learned in 2009 for those of us in the sandwich generation.  Here are five money in the middle lessons from 2009.

Add your own to the list!

1. A house is just a house – We got caught up in thinking about our homes as anything but a place to live.  It was a piggy-bank to bank roll our purchase of a car, an education, a vacation, a second home – you name it we figured out how to tap the growing equity in our homes to purchase more.  It was our retirement plan – forget about retirement savings, we’ll sell the house for multiples of what we paid and live happily ever after on the

The crash of the housing market brought us back down to earth.  But now millions of homeowners of all generations find themselves with more due than the house is worth and foreclosure threatening.  Or stuck – wanting to sell – but can’t sell for enough (house arrest as the condition is now popularly called).

So hopefully we have all learned the value of down-payments, understanding mortgage terms and conditions, and buying what you can really afford – a house to live in. 

2. Credit in moderation only –.  We started to get a handle on the concept of good credit and bad credit in 2009.  Regular saving returned.  Paying down credit became a priority.  Paying cash became fashionable.  College bound children and their parents began making some tradeoffs between piling on college loans and getting started with community college classes. 

Family conversations about money – among all ages from kids to parents to grand-parents—became more frequent, if even still a bit uncomfortable.  Especially important for young adults who have grown up in a “charge it” world who will benefit from learning early the danger of too much debt.

3.  Working in Retirement – This is a phrase that just 18-months ago would have been met with laughter.  Pretty serious stuff now.  While 401(k)s and IRAs have begun to rebound and the stock market looks a bit rosier, the concept of working longer and working in retirement has become the norm. Life has become practical –waiting to take Social Security until full retirement age, staying on the job a bit longer to rebuild savings and keep health care, finding an Encore career (for both money and our mind) and figuring out how we don’t outlive our money.

4.  Having a long-term care plan is a gift for your children– Okay, maybe you are one of those people who say it will never happen to me, but the fact is that living longer can create financial havoc.  I find that more conversations among baby boomers friends turn from the kids to talk of parents – assisted living, nursing homes, Alzheimer’s, stroke  — the emotional and financial pressure of figuring out how to care for our elders who never thought they’d live this long.

A lesson more of us are learning (I hope) is to have a plan for long-term care and share it with your children.  Where do you want to live, if you can’t take care of yourself is there money to help pay for care, what do you expect your family (children, sibling) to do for you?  Who knows exactly how it will all play out but having a plan is a tremendous gift to those faced with helping you.

5.  Families make a difference –This was a year about families pulling together — children moving back in with parents, older generations helping younger generations make house payments, student loan payments; sharing resources and sharing knowledge about money and life.  More talk about values and less about stuff.

It’s been a hard year but in so many ways a good year. Lot’s of lessons learned across the generations.  What do you think? Add a money lesson from 2009.

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Compare Medicare Part D Costs Before the Deadline

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We’re coming to the end of the Medicare Part D open enrollment period for prescription drug coverage.  If you or an elder you are watching out for has a Medicare Part D plan or a Medicare Advantage Plan with prescription drug coverage, the Dec. 31 is coming soon.

 I help my mom with her coverage and to tell you the truth I didn’t think there was any reason to make a change this year.  At least until she got her bill yesterday for 2010. 

The premiums almost doubled!  And while she does not take a lot of prescription drugs, I thought I better do what I tell others to do and check the options available to her.

I was surprised to find out how much the Medicare Part D landscape has changed.  Fewer plans, higher rates, shifting tiers (the level of payment the plan will cover according to it’s formulary).

I see the TV ads promising average savings of $400, $600 and wonder how can that be.  Well, now I see and it doesn’t take long to add up.  An increase of $10-15 per month in the cost of the plan, a shift in the formulary leading to even just $10 more per month adds up in no time at all.

 So, if you haven’t done it, take the time to compare.  Don’t assume the plan you have is the best value for 2010. And don’t get caught feeling bad for switching.  Even Medicrae tells you to shop and compare!

Go to Medicare.gov prescription drug comparison tool and take the time to put in the prescriptions that you or the person you are helping is currently taking (you’ll need the name of the drug, the dosage and frequency).  If you have their Medicare number you can have it compare against the current coverage.

You can purchase directly from the site, go to the health care plan itself or an insurance agent or broker who handles that plan.

If you aren’t sure, try a insurance broker that represents a number of companies and offers to help you compare plans.  The only caution here is if they are commission based, remember that they may receive more if the plan they sell you is more expensive.  So ask.  Some companies pay their agents a flat fee no matter what plan is selected which helps assure that your interests and theirs are aligned.

Looks like we’ll save about $300 by switching to a different part D plan.  Not that we were unhappy with them — just didn’t make financial sense to stay.  Nice way to start 2010.

Did you have a similar experience with part D this year?

Written by Laura Rossman

December 15, 2009 at 5:03 pm