Stablecoins Lead UAE’s Crypto Surge with $9.8 Billion in H1 2024

Gulf Bank held its third quarter 2024 earnings webcast on Monday 04, November 2024, to present and discuss the Bank’s financial performance. The webcast was organized by EFG Hermes and presented by Waleed Khaled Mandani, Acting Chief Executive Officer of Gulf Bank, and David Challinor, Chief Financial Officer of Gulf Bank. The discussion was moderated by Dalal AlDousari, Head of Investor Relations at Gulf Bank.

Operating Environment

Mr. Waleed Mandani, Acting Chief Executive Officer of Gulf Bank, commenced the webcast with key updates regarding Gulf Bank’s operating environment during the third quarter of 2024. Mandani stated: “Recent global economic developments have marked a turning point, particularly with central banks adjusting their monetary policies in response to evolving economic conditions. Most notably, the U.S. Federal Reserve recently implemented a 50-basis points rate cut, signaling a shift in focus from inflation control to supporting growth in the face of slowing economic momentum.”

Mr. Mandani added “On the local front, the Central Bank of Kuwait followed the Fed’s lead by announcing a 25-basis points rate cut. This action underscores the Kuwaiti regulator’s commitment to maintaining a balance between fostering economic growth and ensuring financial stability. Lower borrowing costs are expected to stimulate demand for credit, particularly in consumer lending, as well in vital sectors such as construction and real estate, areas that are crucial for driving the Kuwaiti economy forward.” He added: “Kuwait’s financial system remains resilient, bolstered by stable oil prices and the government’s renewed commitment to economic diversification through large-scale investments. This focus, particularly on advancing key initiatives under the New Kuwait Vision 2035, strengthens the prospects for local banks to continue playing a vital role in financing national development. Gulf Bank is well positioned to play a crucial role in financing these developments, leveraging our strong relationships with both public and private sector stakeholders.”

Loan Growth

When questioned about the loan growth during Q3 2024, Mr. Challinor noted: “Year to date gross loans and advances have grown 6%, which has been dominated by corporate lending with retail being relatively flat. Clearly the current rate environment has significantly reduced the appetite for retail borrowing, but we’d expect this to recover as rates start falling.” He added: “In terms of the outlook, we gave guidance at the beginning of the year that full year loan growth would be around mid-single digits. We’re on track to meet this and may even outperform subject to converting some of the pipeline in Q4.”

Operating Expenses

In terms of operating expense Mr. Challinor mentioned: “We’ve managed to keep operating expense growth to just 4%, year on year, which is very low compared to other banks in the system.”  He added: “There was, however, an increase in other expenses from Q2 to Q3 due to a combination of one-offs and increased consulting/advisory expenses, but the underlying operating expenses remained relatively flat.”

Margins

Regarding margins and the impact from the recent rate cut, Mr. Challinor remarked: “On a year-to-date basis the margin is flat to last year, but we did lose a few basis points from Q2 to Q3. As I said on the Q2 investor call, the cost of funds peaked in Q1, and since then we’ve had 2 quarters in succession of falling cost of funds. The market remains very liquid and clearly the expectations are for further rate cuts. So, on the cost of funds side, we’d expect this to continue to fall.” He added: “Now, clearly, we saw the CBK lower the discount rate by 25 basis points in September after the Fed lowered by 50. So, the local discount rate now sits at 4%. We’d expect this to continue to move lower but perhaps not at the same pace as the Fed. After the local rate cut, we repriced our corporate assets and all new retail business will now be booked at the new prevailing rate.”

Credit Cost

When asked about the credit cost and reasons behind the pickup this year, Mr. Challinor noted: “The credit costs for Q3 were KD 14.2m which were higher than what we saw in both Q1 and Q2. If we look at retail and corporate in turn. For retail, the Q3 credit cost continued to be elevated but was lower than Q1 and Q2.” He added: “On the corporate side, we had an account that moved into stage 3 which had been classified as stage 2 for a significant period of time. Now, if we look at the asset quality indicators, they continue to remain very strong. The NPL percentage is 1.3%. The stage 2 percentage has further dropped and is now only 2.9%, which is probably the lowest in the Kuwaiti banking system, and certainly the lowest the bank has seen since the introduction of IFRS 9.”

Potential Merger with Boubyan Bank

Regarding the latest updates related to the potential merger with Boubyan Bank, Mr. Waleed stated: “We have first made an announcement on 30th July, 2024 regarding the Board’s approval of a proposed potential merger with Boubyan Bank to create a unified, Sharia-compliant entity, and the recommendation to move forward to carry out the needful actions to commence the initial feasibility study and necessary due diligence for the merger, aligned with the Central Bank of Kuwait’s (CBK) guidelines for the merger process. Additionally, on 17th September 2024 we signed a Memorandum of Understanding (MOU) with Boubyan Bank, establishing the foundation for independent assessments to ensure that the best interest of both banks’ shareholders and investors is maintained. And most recently, we have announced CBK’s approval to the selection of the consultancy firms that will be carrying out the feasibility study and due diligence for the potential merger including Goldman Sachs as the Investment Consultant, PricewaterhouseCoopers as the Financial and Tax Consultant, International Counsel Bureau as the Local Legal Consultant, and Freshfields Bruckhaus Deringer as the International Legal Consultant.” He added: “I would like to reiterate our commitment to complying with all applicable laws and the instructions of the Central Bank of Kuwait, as well as the relevant regulatory authorities. We will also ensure that any significant developments in this regard are disclosed in a timely manner.”

The UAE banking sector has reached a historic financial threshold, surpassing AED500 billion in total capital and reserves as of July 2024. This remarkable achievement marks a significant step in the sector’s expansion, underscoring its fundamental role in the UAE’s economic framework.

Data from the Central Bank of the UAE (CBUAE) highlights a 10.5% year-on-year increase in capital and reserves, rising from AED454.9 billion in July 2023 to AED502.6 billion in July 2024. Additionally, the sector saw growth of AED13.3 billion during the first seven months of 2024, reflecting a consistent upward trajectory since the end of 2023, when the total stood at AED489.3 billion.

The capital strength of national banks is a major factor in this growth, as they hold 86.3% of the total capital and reserves, reaching AED433.7 billion in July 2024. This is a 10.4% increase compared to the previous year. Foreign banks, too, contributed significantly, holding 13.7% of the total with AED68.9 billion and experiencing an 11.1% growth year-on-year.

Excluding subordinated borrowings and deposits, these figures, inclusive of current-year profits, highlight the core strength of the UAE banking sector. The sector’s resilience not only strengthens the national economy but also positions it as a pivotal player in regional financial stability. This milestone serves as a testament to the sector’s capacity to support sustainable economic progress within the UAE.

Bitpanda Technology Solutions revealed that institutional investments in the MENA region surged to $338.7 billion in crypto transactions between 2023 and 2024. Saudi Arabia and the UAE are leading this surge, driven by institutional-level interest and the growing dominance of stablecoins.

According to market data, 93% of the crypto value transferred in the region consists of transactions over $10,000, emphasizing the institutional activity in the MENA region. The UAE ranked among the top 40 countries globally, received over $30 billion in crypto during this period; while Saudi Arabia continues to lead as the fastest-growing crypto economy in MENA with 154% year-over-year growth. Stablecoins now dominate the market, representing 65% of crypto transactions across the region, surpassing Bitcoin.

In light of the recent announcement of new tax regulations in the UAE aimed at enhancing tax compliance and governance, the evolving regulatory landscape will further bolster institutional confidence in the region’s crypto market. These measures align with the UAE’s commitment to becoming a global financial hub, ensuring a transparent environment for crypto investments.

“The continued growth of crypto in the MENA region, particularly in Saudi Arabia and the UAE, underscores the rising institutional interest in this evolving market,” said Nadeem Ladki, Global Head of Bitpanda Technology Solutions. “Our infrastructure, offering over 450 crypto assets and regulatory-compliant services, supports these trends, allowing institutions to participate seamlessly in this exciting space.

The UAE’s forward-thinking policy reforms, as exemplified by recent tax law announcements, will only enable further industry growth in the foreseeable future.”

Bitpanda Technology Solutions enables partners to access a wide range of assets, including stablecoins, stocks, ETFs, and commodities, through modular solutions that integrate within three months via API or white-label.

Infobip, a global cloud communications platform, has obtained its SMS license from the Communications, Space & Technology Commission (CST), marking a pivotal step in enhancing its service offerings across the Kingdom of Saudi Arabia and the region.

Infobip has also established direct connectivity with all telecommunications operators in KSA, ensuring full message coverage across the Kingdom. With its SMS license, Infobip is set to provide exceptional messaging services to businesses looking to engage with their customers through one of the most widely utilized channels for business communication. The company will offer market-leading delivery rates and speed, along with advanced analytics and reporting capabilities that are key to its platform.

This milestone follows the launch of Infobip’s first data center in the Kingdom in May 2024, which enables businesses in KSA to send large volumes of digital interactions at high speed with low latency.

Amsal Kapetanović, Country Manager KSA, Infobip, said: “We are excited to announce that we can now facilitate SMS business messaging in Saudi Arabia using our globally recognized cloud communications platform. This ensures that all traffic is hosted locally adhering to national regulations and providing businesses with competitive pricing and comprehensive features.”

Infobip has its own data centers in KSA, which securely host and process data within the country, in line with local and international data security standards. The data center in Riyadh offers scalability and reliability and aims to meet the evolving needs of businesses across various industries.

In line with Saudi Vision 2030, which emphasizes digital transformation and enhanced connectivity, Infobip’s expansion supports the Kingdom’s goals of promoting a strong digital economy. The SMS license and full connectivity will empower local businesses to leverage effective communication strategies that amplify customer engagement and streamline operations.

As Infobip continues to expand its operations in the Kingdom, it remains dedicated to delivering innovative communication solutions that connect businesses with their customers effectively.

Earlier this year, Infobip has been named a Leader in the Communications Platform as a Service (CPaaS) market by analyst firm Gartner for the second year in the 2024 Gartner Magic Quadrant™ for Communications Platform as a Service. Infobip has been recognized for its Ability to Execute and Completeness of Vision.

Saudi Arabia’s finance ministry announced a budget deficit of 30 billion riyals (about $8 billion) for the third quarter, primarily driven by lower oil prices that have impacted government revenue.

During this period, total expenditure reached 339 billion riyals as the kingdom continued to funnel significant resources into its Vision 2030 initiative, which aims to reduce reliance on oil and promote economic diversification.

The total revenue for the quarter was reported at 309 billion riyals. This includes 191 billion riyals from oil revenues and 118 billion riyals generated from non-oil sources. Despite ongoing efforts to enhance non-oil economic growth, the oil sector remains a critical component of the nation’s finances, and recent declines in oil prices and output have led to reduced government income.

At an investor summit in Riyadh, Finance Minister Mohammed Al Jadaan reaffirmed the kingdom’s commitment to its transformative economic strategies. However, the government is currently reassessing its spending plans, which may result in delays or reductions in certain Vision 2030 projects while prioritizing others deemed more critical.

According to forecasts, Saudi Arabia’s economy is expected to grow by 1.3% this year, slightly lower than the International Monetary Fund’s revised estimate of 1.5%. This growth rate is among the slowest within the Gulf Cooperation Council. Nonetheless, increased oil production is anticipated for next year, potentially leading to an overall rebound in economic growth. The non-oil sector now accounts for more than half of the country’s GDP and, while it has experienced some slowdown this year, it is projected to maintain growth around 4%.

As part of its commitment to advancing sustainable business practices and reporting across the Middle East, the Institute of Chartered Accountants in England and Wales (ICAEW) joined leading voices at the recent Middle East and North Africa (MENA) Sustainability Forum. The event brought together government officials, industry leaders, financial professionals, and sustainability experts, to address the latest developments in sustainability reporting and assurance.

Organized by the International Federation of Accountants (IFAC) in partnership with the Emirates Association for Accountants & Auditors, the forum brought together key stakeholders, to discuss the implications of new reporting frameworks, including the Corporate Sustainability Reporting Directive (CSRD) and the International Ethical Standards for Sustainability Assurance (IESA). ICAEW participated in a panel discussion exploring accountants’ expanding responsibilities in supporting sustainable economies. Panel participants included:

• Warren Maroun, Board Member, IAASB
• Jon Reid, Principal, IESBA
• Paul Winrow, Partner – Sustainability Reporting & Assurance, Forvis Mazars
• Hanadi Khalife, Head of Middle East, ICAEW
• Christine Albrecht, Chair, Transnational Auditors Committee, as moderator.

The panelists emphasized the critical role of ethics and independence in sustainability assurance, noting that these principles are essential for ensuring that sustainability reports provide accurate, reliable information in line with growing public interest in corporate sustainability.

While sustainability reporting is still maturing, the panel discussed the challenges of achieving consistent, reliable data, particularly for companies transitioning to mandatory disclosures and to move gradually from limited to reasonable assurance. Global alignment of standards, ensuring comparability and transparency across jurisdictions, was identified as a vital step forward. The development of the IESA, expected to be finalized by the end of 2024, is seen as a major advancement in this area.

Hanadi Khalife, Head of Middle East, ICAEW, said: “Sustainability assurance presents a significant opportunity for chartered accountants to lead in shaping a more transparent and resilient future. By staying ahead of regulatory, policies and standards developments, accountants are well-positioned to guide organizations through the nuances of sustainability reporting, ensuring alignment with global best practices.

“This forum provided an important platform for exchanging insights on how the accounting profession can meet the rising expectations around sustainability. As the Middle East progresses in its sustainability journey, chartered accountants will be integral in building trust and confidence in this critical part of the journey to net zero and to a more sustainable economy.”

MEX Global, a subsidiary of MultiBank Group has launched cash payment services in partnership with Al Ansari Exchange, a subsidiary of Al Ansari Financial Services P.J.S.C. and the largest outward personal remittance and foreign exchange company in the UAE. This innovative service enables clients in the UAE to conveniently deposit and withdraw funds through Al Ansari Exchange’s extensive branch network.

The new integrated service is exclusively available to users in the UAE who are onboarded through MEX Global, which is regulated by the Securities and Commodities Authority (SCA). By leveraging Al Ansari Exchange’s established presence with over 260 branches across the UAE, this agreement seeks to enhance the client experience, providing them with more flexibility and access to their funds.

In his comments, Naser Taher, Founder and Chairman of MultiBank Group, said: “Navigating financial transactions should be seamless and accessible. Our collaboration with Al Ansari Exchange reiterates our commitment to providing cutting-edge financial solutions that empower our clients and facilitate their banking needs in a secure and efficient manner. At MultiBank Group, we are continuously expanding our offerings and enhancing our services through strategic partnerships and innovative solutions, driven by our dedication to excellence and ensuring the highest level of customer satisfaction.”

MultiBank Group, established in California, USA, in 2005, serves over 1 million clients in more than 100 countries and maintains a daily trading volume surpassing $15.6 billion. Known for its forward-thinking trading solutions, strong regulatory oversight, and outstanding customer support, the Group offers a comprehensive range of financial services, including brokerage and asset management. MultiBank Group is regulated across five continents by over 16 of the most esteemed financial regulatory bodies worldwide.

SOUL (Startup One UAQ Launchpad) has officially launched as a dedicated incubator for tech-focused entrepreneurs in the UAE. Inaugurated within the Umm Al Quwain Free Trade Zone (UAQ FTZ), SOUL is set to foster innovation and support high-growth startups ready to make an impact locally and globally. The grand opening was honored by the presence of Sheikh Khalid bin Rashid Al Mualla, Chairman of UAQ FTZ, and Sheikh Mansoor Bin Ibrahim Al Mu’alla, Director of Ports, Customs, and Free Zone Corporation.

The initiative is designed to empower both local and international entrepreneurs by providing critical support to startups in high-impact sectors, such as AI, Blockchain, Fintech, EdTech, PropTech, Reg-Tech, and Robotics. SOUL’s mission is to foster talent and enable entrepreneurs to establish and scale their businesses in the UAE and across the GCC.

Positioned as a comprehensive support platform for emerging businesses, SOUL offers a robust range of services tailored to help startups succeed. These services include incubation, expert guidance from experienced mentors, opportunities for market access, MVP validation, and access to potential funding channels. SOUL is structured to support startups as they work toward growth within the UAE and the broader GCC region.

“SOUL’s objective is to create an innovation hub that nurtures startups in their journey to becoming key players in the UAE and GCC markets,” said Mr. Johnson M. George, General Manager of UAQ FTZ. “Our programs are structured to provide startups with the resources and guidance they need to navigate challenges, validate their models, and accelerate growth.” Beyond workspace and mentorship, SOUL connects entrepreneurs directly to investors and provides access to high-potential markets. The incubator’s structured programs, including workshops, networking events, and pitch days, foster a collaborative environment where startups can refine their products and scale their businesses.

Dr. Hisham Safadi, founder of UDENZ and a mentor at SOUL, praised the incubator’s unique approach. “SOUL is different from other incubation programs because it offers targeted support to startups that already have an MVP or are seeking to validate their business models. This level of mentorship is invaluable for startups looking to scale quickly.”

The Federal Tax Authority (FTA) has issued an important reminder for all Resident Juridical Persons with licenses issued in October and November, regardless of the year, to submit their Corporate Tax registration applications by November 30, 2024. This requirement comes as part of the FTA’s ongoing efforts to ensure compliance with the new Corporate Tax regulations introduced under Federal Decree-Law No. 47 of 2022, which took effect on March 1, 2024.

In a recent press statement, the FTA emphasized the importance of adhering to the timelines outlined in FTA Decision No. 3 of 2024. This decision specifies registration deadlines for different categories of Taxable Persons who are subject to the Corporate Tax. The FTA has warned that failing to submit registration applications on time will result in administrative penalties as stipulated in Cabinet Decision No. 75 of 2023.

The registration requirement applies to both Juridical and Natural Persons, whether they are Resident or Non-Resident. Juridical Persons that were established or recognized before March 1, 2024, must register based on the month their license was issued, regardless of when that issuance occurred. For those holding multiple licenses, the earliest license issuance date will dictate the registration deadline. Even if a license has expired, the registration must be based on the original issuance month.

The FTA has made the registration process more accessible through its EmaraTax digital platform, which operates 24/7. The streamlined procedure consists of four main steps and is designed to take approximately 30 minutes to complete. Existing Value Added Tax or Excise Tax registrants can use their EmaraTax accounts to register for Corporate Tax and submit necessary documents. Once approved, applicants will receive a Tax Registration Number.

Taxable Persons who have not yet registered are encouraged to create a new username on the EmaraTax platform at eservices.tax.gov.ae, using their email and mobile number. After setting up an account, users can easily complete the registration by selecting the ‘Register for Corporate Tax’ option and following the straightforward steps.

Additionally, individuals can register through authorized Tax Agents listed on the FTA’s website or at various government service centers throughout the country, which offer electronic services overseen by trained personnel.

Finally, the FTA urges all Taxable Persons to familiarize themselves with the Corporate Tax Law and related guidelines, which are available on the FTA’s website at tax.gov.ae. Compliance with these regulations is crucial to avoid penalties and ensure a smooth tax administration process.

Kuwait International Bank (KIB) signed a Memorandum of Understanding (MoU) with the Gulf University for Science and Technology (GUST) for collaboration on its innovation program. The MoU will create a strong foundation for innovation incubation and acceleration, offering students significant opportunities for growth and development. The new agreement comes as part of the Bank’s commitment to its comprehensive social responsibility strategy, as well as its support of education and youth empowerment for a brighter future.

KIB will take the lead in coordinating and overseeing the innovation program, with the support of a globally recognized innovation expert. Through this partnership, GUST students will have the chance to participate in projects aimed at cultivating creative ideas and solutions. These students will benefit from hands-on experience through internships and co-op programs at KIB, where they can apply their academic knowledge in a practical banking context. In addition, KIB will evaluate top-performing students and graduates for potential employment opportunities, reinforcing the Bank’s dedication to fostering local talent and supporting their professional growth.

Commenting on the new partnership, Mohamed Atef El-Shareef, General Manager of the Digital Innovation and Data Intelligence Department at KIB, said: “KIB’s agreement with GUST marks another important step in its mission to bridge academia and industry, ensuring that the next generation of professionals is equipped with the skills and knowledge to excel in the rapidly evolving banking sector. The collaboration is also a reflection of KIB’s efforts to be among top institutions leading the way in innovation within the banking industry.”

El-Shareef added: “By forging agreements with academic institutions, we aim to build a robust pipeline of talented professionals who will not only contribute to our business but will also shape the future of banking in Kuwait. We look forward to signing more agreements with other universities in the near future as part of our ongoing efforts to invest in the youth and the future of the financial industry.”

On his part, Professor Bassam Alameddine, President of Gulf University for Science and Technology (GUST), stated: “We are delighted to cooperate with KIB in this initiative, as it will provide our students with a pioneering opportunity to apply their theoretical knowledge in a hands-on industry experience. Through working with experts in the banking industry, our students will be able to develop innovative solutions for the banking sector and acquire the necessary skills to excel in their careers. This partnership reflects our strong commitment of preparing our graduates to become innovative leaders in the Kuwaiti job market.”

Prof. Bassam Alameddine added: “GUST has consistently fostered innovation within its advanced academic programs, ensuring they align with the evolving demands of the Kuwaiti job market. Moreover, GUST actively supports initiatives launched by Kuwaiti youth in the field of startups and their career pursuits within both the private and public sectors. This unwavering commitment is driven by a shared vision of contributing to the advancement and prosperity of Kuwait and its young generation.”

Recent reports from Ras Al Khaimah’s Department of Economic Development reveal a significant upswing in economic activity, highlighting the Emirate’s thriving business environment. By September 2024, the total capital of valid licenses rose to AED9.26 billion, marking a 15% increase from AED8.00 billion last year, which translates to an additional AED250 million.

The number of valid licenses has also seen a healthy growth of 2.9%, now totaling 20,408. This expansion spans several sectors, with professional licenses totaling 10,077—an increase of 2.9%—commercial licenses reaching 9,729, and industrial licenses growing by 3.4% to 578.

Particularly noteworthy is the Nakheel area, which has emerged as a key player in this growth, showcasing 2,266 valid licenses and capital approximating AED2.2 billion. This area alone has experienced a remarkable capital increase of 29.1% year-on-year.

Amina Qahtan, Director of the Department of Commercial Affairs, credits this positive momentum to the proactive economic strategies implemented by the Emirate, alongside the government’s dedication to nurturing a supportive business landscape. She emphasized that the introduction of various measures to streamline business operations has been essential in propelling this impressive growth.

A Thriving Economic Landscape

The emirate has seen substantial growth in recent years, establishing itself as an attractive hub for investment and tourism, as well as a prime location to live, work, and explore. Ras Al Khaimah boasts a robust manufacturing and industrial sector, which accounts for approximately 30 percent of its overall GDP. The remaining GDP is distributed across various complementary sectors, showcasing the economy’s diversity and its capacity to attract and retain a wide range of businesses, from small and medium-sized enterprises to large multinational corporations.

Accenture and du, the leading telecom and digital services provider, are collaborating under a five-year contract to help du on the Application Development and Maintenance (ADM) of its IT landscape.

Under the AMD contract, Accenture will work closely with du and its partners to move to a new operating model that enables them more flexibility & predictability and to maintain and evolve du’s IT applications.

By implementing new ways of working and processes in line with industry best practices, the new model will help du break silos, accelerate time to market and enable the launch of innovative products and services while improving efficiencies.

Accenture will also support du with the adoption of new technologies and products, including gen AI and advanced analytics, helping du achieving its business objectives in line with its digital-first strategy.

Fahad Al Hassawi, Chief Executive Officer du said: “Our partnership with Accenture marks a shift in our journey towards an innovative, digital-first future. Leveraging Accenture’s expertise in ADM, we aim to significantly boost our agility and market responsiveness in line with our commitment to breaking silos and fostering a culture of innovation and efficiency, enabling us to offer more advanced, customer-centric solutions. Through new technologies like gen AI and advanced analytics, we are poised to redefine what’s possible, aligning with our goal to not only meet but exceed our business objectives in the digital era.”

Omar Boulos, Chief Executive Officer of Accenture in the Middle East, commented: “This is a time for collaboration globally when it comes to converging best-in-class technologies and expertise to truly maximize the potential of cutting-edge tech. We are thrilled to be partnering with du to drive the digital transformation of its infrastructure. We believe that our collaboration will not only enhance du’s capabilities but also contribute to the advancement of the technology landscape in the region.”

At 34, Kait Giordano is juggling her job, a newborn and two parents with dementia.

Just over a month into motherhood, she tends to her infant son and her live-in parents in the morning and afternoon, some days with the help of a rotating cast of paid companions at their Tucker, Ga., home. In the evenings, her husband, Tamrin, takes over while she colours hair.

They had already delayed starting a family when Kait’s father moved in a few years ago. Her mother moved in this year. “We chose to take this on,” she says. “We didn’t want to wait any longer.”

More Americans shoulder a double load of caring for their children and at least one adult , often a parent. The “sandwich generation” has grown to at least 11 million in the U.S., according to one estimate, and shifts in demographics, costs and work are making it a longer and tougher slog.

People are having children later, and they are living longer , often with care-intensive conditions such as dementia. That means many are taking care of elderly parents when their own kids are still young and require more intensive parenting—and for longer stretches of their lives than previous generations of sandwiched caregivers.

As the oldest millennials start to hit middle age —and baby boomers near their 80s—the number of Americans caring for older and younger family makes up a significant part of the electorate. Vice President Kamala Harris invoked the sandwich generation when she recently proposed expanding Medicare benefits to cover home healthcare.

“There are so many people in our country who are right in the middle,” the Democratic presidential candidate said on ABC’s “The View” this month. “It’s just almost impossible to do it all, especially if they work.”

Responding to the Harris proposal, former President Donald Trump ’s campaign said he would give priority to home-care benefits by shifting resources to at-home senior care and provide tax credits to support unpaid family caregivers.

The growing burden on this sandwich generation weakens careers and quality of life, and has ramifications for society at large. It is a drag on monthly budgets and long-term financial health.

A 40-something contributing $1,500 a month over five years to support an aging parent stands to lose more than $1 million in retirement savings, according to an analysis by Steph Wagner , national director of women and wealth at Northern Trust Wealth Management.

“It’s become incredibly expensive to manage the longevity that we’ve created,” says Bradley Schurman , an author and demographic strategist, who says that the demands of caring for older generations could push more people in midlife to retreat from the workforce, particularly women. “That’s a massive risk for the U.S. economy.”

Career goals on hold

Not too long ago, the typical sandwich caregiver was a woman in her late 40s with teenage kids and maybe a part-time job. Now, according to a 2023 AARP report, the average age of these caregivers is 44, and a growing share are men. Nearly a third are millennials and Gen Z. They are in the critical early-to-middle stages of their careers and three-quarters of them work full or part time.

Diana Fuller, 49, says being the go-to person for her 83-year-old mother’s care for more than four years has been stressful, even with her mother now living in a nearby, $10,000-a month memory-care centre in Charlotte., N.C. (Long-term-care insurance covers 75%; the rest is paid out of her mother’s savings.)

She has put on the back burner career goals such as ramping up the leg warmer business she started with her sister. She has missed moments such as her 9-year-old son’s school holiday concert last year because of her mother’s frequent hospital stays.

Her husband picks up a lot of the child care duties when her mom is in the hospital. Still, she says, “it often feels like everything is about to implode.”

The financial pressures are also growing for the sandwich generation. According to a Care.com survey of 2,000 parents, 60% of U.S. families spent 20% or more of their annual household income on child care last year, up from 51% of families in 2021. Meanwhile, the median cost of a home health aide climbed 10% last year to $75,500, data from long-term-care insurer Genworth Financial show.

Caregivers often risk paying for such costs in their own old age, financial advisers say. More than half reported in a 2023 New York Life survey that they had made a sacrifice to their own financial security to provide care for their parents on top of their children.

Long-distance care

Many in the sandwich generation say they feel torn between the needs of their kids and parents. Liam Davitt , a public-relations professional, and his wife, Lisa Fels Davitt , recently moved from their Washington, D.C., condo to suburban New Jersey so that their 7-year-old son could be closer to cousins and go to a good public school. (They had previously paid for private school.)

That meant moving away from his 84-year-old mother in an independent living community. The long distance has made helping her even with little things more complicated, such as troubleshooting glitches with her iPhone. He recently enlisted a nearby fraternity brother to help her assemble a new walker.

An avid runner, he says he finds himself taking care of himself—avoiding potentially ankle-twisting mud runs and keeping up with his doctors’ appointments, for example—out of fear he won’t be able to care for his younger and older family.

“If all of a sudden I’m less mobile, then I’m more of a burden on my own family” says Davitt. He is planning to move his mother closer by.

The Giordanos, in Georgia, have made adjustments, too. With their newborn keeping them busy, they installed cameras and door chimes to help monitor Kait’s parents.

Her parents enjoy pushing their grandson in the stroller around the house while supervised, she says. When Tamrin comes home from work, he gives his in-laws dinner and medications while holding the baby.

The couple isn’t sure when they’ll have another child, which would require paying for more help.

“We may have to wait,” Kait said. “We’re very much living in the moment.”

October is traditionally the time to break out the cozy sweaters and consume as many pumpkin-spice drinks as possible. Instead, people are now using it to reset their goals.

Dubbed “October Theory,” these people are rethinking their approach to the last three months of the year. They’re using it as a time to set goals, pick up new habits and reflect—essentially taking on the role New Year’s plays.

October Theory is the latest “theory” social media has latched onto. Between the uneven job market, inflation, and the usual daily grind, people are looking for something they can control. Setting goals and improving their lives —whether it’s their health, finances or mindset—is something they are gravitating toward.

Sarah Stone, a 35-year-old Realtor in Kansas City, Mo., says October is a better time to reflect on the previous nine months and also home in on what she wants to achieve in the last few months of the year. This month, she’s decluttering her home and purging habits such as too much impulse shopping at TJ Maxx.

“It feels almost like the beginning of the year is in the wrong place on the calendar,” says Stone.

October can feel like an introspective time for people since the seasons are changing, a new academic school year has started and the current year is on its way out, says Laurie Kramer, a licensed clinical psychologist and a professor of applied psychology at Northeastern University. The Jewish new year—Rosh Hashana—also takes place in September or October, giving millions a time to reflect.

“This is a great time, 90 days from the new year, from the holidays, to reassess, see where you are with things,” Kramer says.

Start now, win later

October Theory is catching on partly because it sets someone up for success by the time January rolls around, say fans of the trend. Instead of picking up a new habit in the dead of winter—at the same time everyone else is trying to make it to the gym, for instance—it has already been in place for three months.

Every new year, Allison Bucheleres, a 30-year-old lifestyle and fashion content creator in Miami, tries to set new goals. Often, she fails because she doesn’t have a routine in place to make it happen.

Most of her goals this month revolve around setting new daily routines, such as waking up at 7 a.m., journaling her thoughts and writing self-affirmations to reframe her thinking. Around the middle of the day, she’ll repeat her positive phrases—at times over 100 of them—and will sometimes write one on a sticky note to post on her bathroom mirror.

Bucheleres’s newest self-mantra: “I can control my work and my self belief, but not the timing.”

Simple behaviours that are easy to repeat could take as few as 30 times to become a habit. More complex ones, such as going to the gym, could take up to three months of daily practice, says Wendy Wood, professor emerita of psychology and business at the University of Southern California.

The best time to change behaviour is during a big life change, such as moving to a new house or starting a new job or relationship—regardless of whether it’s in January or October, she says.

“You have a sort of window of opportunity to make decisions about what you want to do without your old habits getting in the way,” Wood says.

Making the most of 2024

Others view October as a last chance to fulfil the goals and aspirations they set months ago.

That includes Mateo Pérez, who is in the final stretch for his weightlifting and running regimen. The 19-year-old sophomore, who is majoring in creative advertising at the University of Miami, is also working on an application to transfer to New York University for the fall 2025 semester. Pérez wants to finish the application by the end of this semester in December.

“Right now, it’s like a reflection of this whole year and how can we make the most of the last three months,” Pérez says.

Psychologists say being introspective—at any time of the year—helps people develop habits and routines. It is often the key to following through on your goals.

Two Octobers ago, Kelly Sites, a 38-year-old customer-support manager and content creator, decided to stop living overseas. By February, she had moved to Kansas City, Mo.

This year, she’s trying to set up a daily meditation and breathing practice, and eat more whole foods. In a TikTok post on Oct. 2, Sites encouraged people to go to their photo albums and type in October to see how much their lives have changed in the 10th month of the year.

“It’s this idea of hibernation, seasons changing,” Sites says. “There’s always seeds of my life that were planted in October that changed the rest of the year.”