Glen & Amber are a middle-aged couple sandwiched between their young adult children and elder parents.   Glen is a director at his company and not sure that retirement is possible right now.  He’s managed investments on his own after a negative advisor experience.  They came to us seeking guidance on how to navigate financial decisions while juggling the pressures of supporting their family.

Glen and Amber have three children ranging from 15 – 24. Olivia recently finished college and works in a city where she needs help covering rent and essential expenses.  Steve is a high school senior who’s looking at out-of-state colleges and Zoey just entered high school and plays travel soccer.

In our Discovery Meeting, we asked about their parents and learned that Glen’s parents are in their late seventies and becoming less independent.  His sister lives only about 45 minutes from them but increasingly frequent trips have put a strain on her family.  Amber’s parents are divorced; her dad and his new wife are stable, but her mom is struggling with both health and financial issues.

To achieve comfort with Glen’s retirement decision, we started by addressing the family needs.  Through our Generational Conversations program, we provided valuable information on care management tips and options.  We also support adult children and their elder parents to agree on Housing, Legal Strategies and Security.  Hiring occasional home caregivers who report to Glen’s sister proved to be a good solution. Amber’s mother moved into independent senior living at a very reasonable monthly cost.  She is happier with new friends in a social setting and Amber is greatly relieved.  The proceeds from selling her mom’s home combined with Social Security will keep her financially stable for many years.

The couple’s elder daughter, Olivia had some 529 funds remaining, which we transferred to Steve.  Olivia now gets health insurance through her employer and pays for her own phone and car insurance.  Glen and Amber agreed to a monthly rent stipend for the first year, provided that she shares an apartment.  They also buy airline tickets for Olivia to fly home occasionally.

In addition to increasing 529 contributions for Steve and Zoey, we opened custodial (or UTMA) accounts.  These are irrevocable gifts that a parent controls until the children reach their state’s age of majority.  Unlike 529’s, they can receive annual gifts of stock and mutual funds and get a preferential tax rate on capital gains.  So, Glen gifted some appreciated company stock which we promptly sold.   The proceeds can immediately cover some of Zoey’s soccer expenses, and later fund college costs ineligible for 529’s like cars, Greek life and entertainment.

With these issues addressed; we narrowed in on the retirement conversation.  We explored strategies for taking Social Security, including Amber starting early and increasing Glen’s future benefit by waiting, which will help sustain the surviving spouse.  Glen’s company stock and deferred comp plans can fill in while he postpones Social Security.  We started working with this family right away, to implement our paradigm of aligning investments to funding timeframes, by investing the couple’s brokerage and IRA accounts to synchronize with the limited investment options available in Glen’s company 401(k) plan.