Skip to Content

How to save money when paying for your kids and aging parents

Home BlogHow to save money when paying for your kids and aging parents

Key takeaways:

  • The sandwich generation often pays for both their parents and children, which can be costly.
  • There are a variety of ways to save money, so paying for both generations doesn’t derail your financial goals.
  • With programs such as Bank Your Change, you can save money without feeling like saving is a chore.

Are you paying for your kids and your aging parents? If so, you’re part of the sandwich generation – named for the generation “sandwiched” between two generations that require care.

According to the U.S Bureau of Labor Statistics, 41.3 million people provided unpaid eldercare in 2015 and 2016, and that number is only expected to grow. As you continue to pay for your children – whether it’s college tuition or helping them start on the right foot as they enter the workforce – it can be difficult to pay for your or your partner’s parents’ care at the same time.

Here are a few tips to help you save money while supporting both your kids and parents:

  • Bank Your Change: This MidWestOne program is a simple way to save money when you use your MidWestOne debit card (both debit and credit transactions). Each time you use it, the amount is rounded up to the next whole dollar and the difference is automatically deposited into your savings account. For example, if you pay $9.22 for a movie ticket, it’s rounded up to $10, and the extra 78 cents are deposited into your savings account.

A great benefit of the program is that you can designate more than one account for Bank Your Change savings, and the total transfer will be evenly split. If you have a savings account for yourself and your kids or parents, you can save in both.

  • High Yield Savings: Some savings accounts can earn you a higher rate of interest than others. MidWestOne's new Power Savings could be a great option for you to earn interest. 
  • Structure your savings into Certificates of Deposit (CDs):A CD is a low-risk savings option that enables you to capture higher rates of interest the longer you invest. Excess balances in your checking
    or savings accounts can be put into a CD so you can save more money. Many certificates require a minimum deposit, check with your bank to see what theirs is so you can start earning.
  • Start a Health Savings Account (HSA): An HSA is primarily for qualified medical expenses, but it can also help you save for retirement. Contributions made via payroll deductions can help reduce your federal and state income tax liability. Your account balance will grow tax-free, and withdrawals for qualified medical expenses are also tax-free. A high deductible health plan is required for an HSA.

With a strategic approach, you can continue to care for your parents and kids. If you have questions about how you can save money and better organize your finances, visit your local MidWestOne branch.

MidWestOne Bank does not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.