THE GREAT AMERICAN SANDWICH

For Heather and Tim, taking care of two generations meant major life changes

HEATHER MCKUSICK IS JUST THIRTY YEARS OLD, but she’s already struggling with an issue that many people don’t run into until ten or fifteen years later.

Heather and her husband, Tim, also thirty, are part of the sandwich generation. That doesn’t mean they like tuna salad on wheat bread. It means Heather and Tim are trying to take care of both their young children and their parents. That includes Heather’s mother Barbara, fifty-six, and Tim’s parents, Colleen and Martin, both fifty-three, who have struggled with financial and medical issues. Meanwhile, their sons, Tyler and Cody, are three years old and eight months old, respectively.

That’s an awful lot to deal with for Heather, a third grade teacher in Warren, Massachusetts, a town of about five thousand that’s big on young families, outstanding education, and a strong sense of community.

Tim is a full-time college student who also works in retail. They’re former high school sweethearts.

“We both graduated high school in 2000 and he began going to college, but even at eighteen, he was responsible for helping his family with finances,” Heather said. “After a semester, he decided to just pursue full-time work. We got our own apartment when we were nineteen and he maintained full-time work to support us while I went to college full-time and worked part-time about thirty hours a week.”

The plan was for Heather to finish her bachelor’s degree and start working. Then Tim would return to school, she would support the family, and he’d assume the part-time work and student role that Heather had.

“Unfortunately, we had accumulated significant credit card debt while I was a student—car repairs, books, classes, and of course we fell prey to the ‘extras’ that we also thought we needed but couldn’t afford on our own. And my first teaching salary was $32,000 . . . with an automatic 11 percent taken off the top for my retirement/pension . . . and taxes . . . and health insurance. . . . I ended up making like $400 a week!”

That wasn’t much money to cover rent, two car payments, a student loan she had taken to help cover expenses for a semester when she had to do her student teaching, and credit card bills in both their names, plus utilities and groceries.

So Tim ended up just returning to school part-time, one or two classes at a time, in order to continue working full-time. Along the way, he has had to take some semesters off, especially when Heather was pursuing her master’s degree, which she had to get within five years to keep her job.

In 2007, Heather and Tim bought a duplex so they could stop paying rent and have a place to live. Tim’s parents live in the other side of the duplex, and pay a discounted rent of $500 a month.

“We actually had bought our property because of my father-in-law’s health,” said Heather.

Her father-in-law developed an infection while he was in the hospital, and he and his wife ran into financial trouble. Heather and Tim were in the market for their first home, so they bought a house that would allow Martin to convalesce and focus on his health without having to worry about bills.

They’re thinking about buying another house so Heather’s mom could move into the duplex and they could have a space of their own. Barbara has also had medical issues, and has had several brain surgeries.

“Ultimately, I would like to provide for her,” said Heather. “As a renter, she has some uncertainty—her landlord can increase her rent, she could be asked to leave so they could owner-occupy, etcetera. We also see the house we have as a potential investment to create a future income for our boys. So we want to keep the property for both reasons . . . provide for our parents in the near future and provide for our boys in many, many years.”

In trying to care for kids and parents on a schoolteacher’s salary, Heather and Tim have learned to be more frugal. As a college student, Heather developed a weekend shopping habit that almost did her in.

“I was essentially a kid, in college, working about thirty hours a week . . . and this is partially the root of my credit card debt and careless spending patterns, which earmarked my early twenties.”

She and Tim, in struggling to pay their bills, ended up with $15,000 to $20,000 in credit card debt. Each had seven to ten credit cards.

“At one point, we were easily spending a quarter of our income on minimum payments!” she said.

Heather managed to refinance her car and consolidate her credit card debt with a local credit union, which improved her cash flow.

“It kept my head above water and probably saved my credit score because I was actually able to maintain the loans and pay them off.”

Now they are reformed spenders.

“We pay cash. We are trying to build up savings. We think long and hard about financial decisions and are trying so very hard to pay off the credit card debt that practically drowned us! It is tough!”

They’ve been on only one real vacation in fourteen years and they paid cash for it.

“We are still paying for our mistakes with frugality and impulse control over a decade from when we first made them! We have learned!”

Being a member of the sandwich generation is hard for Heather and Tim, not just because of the financial or time stresses, but because they have to consider everyone’s best interests and don’t have the autonomy they would like.

“I’m not sure if this makes sense, but the whole notion of doing things for everyone and not for us is the hardest.”

Fortunately, Heather loves her job.

“I am so fortunate to honestly be happy to go to work every single day! I truly feel as if teaching is a true vocation or calling to me. I work hard to ‘pay it forward’ and give back to the community and society.”

She’s grateful for what she has, and looking to build a stronger future for herself and her family.

What can you learn from Heather and Tim’s story?

Consider a long-term care insurance policy.

• If you are fifty or sixty, you’re at the prime age to buy long-term care (LTC) insurance, a kind of policy that pays for care in a nursing home, an assisted living facility, or your own home as you age.
• Shopping for LTC insurance can be simplified by contacting an independent agent who can shop quotes from a variety of companies for you. Companies like AALTCI .org, LTCTree.com, and PrepSmart.com are all good starting points.
• When shopping for LTC insurance, look for a lifetime benefit—or at least five years’ coverage if that’s too costly. Also, be sure the policy adjusts for inflation so the benefit is not subpar when you need it.
• Finally, you only want to consider companies that have been rated “A++” (by A.M. Best), which means they are of the highest financial strength. Visit AMBest.com to search ratings. Free registration is required.

Get a will in place.

• If you have kids, you need a will for the simple fact that if you don’t have one, the state will decide who raises your kids. That’s the reality in the absence of any written direction from you. Some people use the excuse that doing a will is too complicated and too expensive for them to undertake. I don’t buy that.
• It’s true that if you have a complicated life—maybe you own your own business or have a blended family—you do need to go see a lawyer who specializes in wills, estates, and trusts.
• However, if you have a relatively simple situation like the McKusicks, I like the WillMaker software that you can pay to use through Nolo.com. They do a great job of asking interactive questions to guide you through the will completion process.
• If you get confused along the way, stop and see a lawyer. Or push through and know that it is much cheaper to have a lawyer review the will you’ve self-prepared than to actually prepare one for you from scratch.

Get a durable power of attorney in place.

• A durable power of attorney (DPA) is a document that allows your parents (the “principal”) to authorize you (the “attorney-in-fact”) to make financial/legal decisions and to make financial transactions on their behalf.
• There are advantages to having a lawyer draft a DPA. First, an attorney-drafted DPA can be drafted to meet your individual needs. Although there are preprinted forms available, they are worded broadly and do not give you as much flexibility. Second, since DPAs are subject to abuse, it is a good idea to meet with an attorney to make sure both the principal and the attorney-in-fact understand the document and the attorney is assured of the principal’s competency.

Protect your children’s identities.

• It’s an unfortunate fact that kids are targets for identity thieves. According to the 2012 Child Identity Theft Report, children are thirty-five times more likely to be subject to identity theft than adults are.
• Thankfully, AllClearID.com is now offering a new free service called ChildScan. The service combs through credit records, employment records, criminal records, and medical accounts to find out if a crook has been using your kid’s Social Security number. Visit AllClearID.com/plans/child for more details.
• Crooks target kids because they’re ideal candidates for identity theft—no credit history but a clean Social Security number. As a parent, you want to make sure nobody messes with your children. And the sooner you find out, the better, because if it goes on for a decade or more, it can take years to clean up.