After the Industrial Revolution, the nuclear family became prevalent as couples left their extended families to follow their work or their dreams. Moving away from their families allowed them to get a fresh start on life, but it also removed a support system stretching back several generations. With travel getting easier as time goes by, the entire concept of the "nuclear family" is fracturing, and something more temporary has taken its place.
These disconnected families are finding it difficult to manage all of the responsibilities associated with raising children and caring for their parents. With financial woes and the uncertain world economy, the extended family or multi-generational family structure is beginning to make a lot of sense again. After all, wouldn't it be nice to have your parents help you take care of the children? If you hire help, they can help your children and your parents, too. And, your kids could benefit from growing up with your parents -- something that many families today really miss out on.
The "Sandwich Generation" (those who are taking care of parents AND children at the same time) are facing big decisions today as they consider their financial future. The first priority is funds to raise the children, then pay for college. If that alone isn't scary, add on the cost of eldercare and assisted living for parents and the bill could EASILY exceed earned income. Yikes!
If what I've just described sounds like you, that means that you'll probably have to work for the rest of your life, because how else are you going to support everyone? Forget your retirement!
So what are your REAL options?
#1: Student Loans
Yup. Do the math. If you can't afford to retire and your parents don't have pensions or trust funds, you've got some pretty big bills coming your way. You've got to get your head out of the sand (or clouds) and start making smart choices. Maybe you can split the college tuition with your kids. Lots of parents are doing just that. It's really not a bad idea because when the kids are footing the bill or even just contributing towards it, I'll bet they'll take their college experiences more seriously and possibly graduate sooner (hence, reducing the overall cost).
#2: Live at Home While Going to College
I know this isn't a popular idea, especially with the kids who want the "college experience" and if you really need a break from the teen years. But having your kids live at home could save you $50,000 over 4 years for each child. Yes, you'll still have to yell at them to clean up their room, but $50k can buy a lot of nice things. Like wine. Or trips to Bermuda. Just saying...
#3: Parents Move in With You
This is a perilous proposition on a lot of fronts. What if you don't like your in-laws or your parents? What if they don't like you? Ok, that'd never happen, because YOU ARE AWESOME, but still - hypothetically, it could happen. Having them move in with you could be a really bad idea, and I get that. But, what if they build a "Granny unit" on your property (aka Accessory Dwelling Unit) so they have their privacy -- and you have yours! -- so you're not forking out $75,000 per year, per person! That's even more than college tuition. When they're gone, your college-aged kids could live there or you can rent it out for some extra cash.
#4: Everyone Moves into a Larger Place
If your current home is too small to include college kids and/or grandparents, consider upgrading to a larger home. Whether you rent or own, this could work for you. Find just what you need and everyone contributes towards the rent or mortgage. It will still be considerably less expensive than paying for dorms, assisted care, AND your current rent or mortgage.