A generation under pressure

In many Western economies, family obligation typically runs in two directions: up to parents, down to children. In South Africa, it often radiates outward to siblings, cousins, nieces, nephews, aunts and uncles. This isn't unique to any one community; it's a feature of how method of survival for many South African families have had to survive. The first person in the family to achieve financial stability often fills the gaps for everyone else, covering school fees for their nieces and nephews, bridging the gap if a sibling loses their job, or sending money to parents in another province.

Some communities think of this as Ubuntu: the idea that we exist through our relationships with others, and that individual success is incomplete if those around us are struggling. It's a profound and sustaining worldview in which providing financial support is often considered a privilege. But for the person carrying the financial responsibility, it can also have an "incapacitating element," where giving comes with a hidden cost: financial stress.

What is the sandwich generation? 

In 1950, only 8% of the population was over the age of 65. Today, that figure has more than doubled, and by some estimates people over the age of 60 will comprise 22% of the globe by 2050. Not only are our parents living longer, but the average age at which people have children has steadily climbed. The result is that many of us are raising teenagers while our parents enter their seventies and eighties.

This creates an unprecedented squeeze. Previous generations might have supported ageing parents for a few years in their sixties, by which time their own children were long settled. Today, you might find yourself funding university fees and retirement care simultaneously for a decade or more.

Researchers call this the sandwich generation, and according to recent industry research, almost half of working South Africans are in this position, particularly those between 30 and 49.

This is often a significant stress point for primary earners, who find they're pushing aside their own retirement planning or debt repayments in favour of meeting a more urgent financial need from extended family. And in a country where only 6% of South Africans are on track to retire comfortably, you might be asking yourself, "who's building my safety net while I'm serving as theirs?" 

Protecting your family when you are the primary breadwinner

Building your own future while funding everyone else's present

When a significant portion of your income goes toward supporting others, it's tempting to push your own wealthbuilding to "later". But consider that the very reason you're stretched now is the same reason you need to build a base that can sustain you independently as you grow older.

Balancing accessible and long-term investments 

Your investment strategy needs to account for two competing realities: the likelihood of short-term family emergencies and the certainty that your own retirement is approaching. This means building a tiered portfolio:

• An emergency buffer: Three to six months of expenses in a money-market or similar low-risk, easily accessible account.

• Medium-term investments: Unit trusts or tax-free savings accounts that can be accessed if needed but are earmarked for goals 5 to 10 years out. This could help your children pay the deposit on their first home, for instance.

• Long-term growth: Retirement annuities and pension funds that compound untouched. It's essential that these kinds of savings are paid before you consider your disposable income each month. By making these your non-negotiable investments, you build your own safety net for the future.

   

How protection insurance can enable investment

It can feel counterintuitive, but having appropriate life cover in place can actually free up more money for investing. If you're holding cash in reserve because you're worried about what would happen to your parents or children if you couldn't provide for them, adequate insurance may allow you to redirect some of that buffer into higher-growth investments. In this way, protection and growth complement each other.