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The growing number of Americans caring for their aging loved ones often face financial strain along with their daily caregiving responsibilities. A survey this year of 1,345 family caregivers by Caring.com found that 46 percent of caregivers spend more than $5,000 a year on related expenses. Those costs include medications, medical bills and in-home care. One-third of respondents said they spend 30-plus hours a week on caregiving and half said they had to change their work schedule to make room for those responsibilities.
“All across the country, adult children are paying for this just at the time when they should be saving for their own retirement,” says Andy Cohen, founder of Caring.com. He started the site after being a caregiver for his mother, who passed away from cancer in 2006. He says his family made many financial mistakes, including hiring an in-home care agency that wasn’t covered under his mother’s long-term insurance policy; not having necessary financial documents, like one that designates a health care agent in place; and paying for care out of his own savings rather than his mother’s assets, which is not optimal from a tax or Medicaid eligibility standpoint.
Cohen urges families engaged in caregiving to set up a family meeting to talk through the financial ramifications and how to handle them. If one person is serving as the primary caregiver, then other siblings might want to contribute more financially, for example, he says. “It’s becoming more common to pay the family member who is the caregiver,” he says, especially because that person often has to cut back on his or her work hours or even quit a job altogether.
Cohen also notes that despite the fact that 43 million people in the country are now caring for someone over age 50, caregivers often feel very lonely. He urges them to seek support through websites like his own. Caregiving experts also offered these five strategies for minimizing the financial stress of taking care of an older adult:
1. Leverage community help. This approach won’t work for everybody, but those who live in close-knit communities might find some relief by sharing duties with neighbors or enlisting a local scout troop to handle yard work or read to the older adult. Paula Spencer Scott, author of “Surviving Alzheimer’s: Practical Tips and Soul-Saving Wisdom for Caregivers,” shares the story of two neighbors who both lived with their mothers and took turns handling caregiving duties for both women. She adds that local meal programs or adult day care services might be available at low or no cost.
2. Hire help for yourself. Scott says that for a relatively low cost, caregivers can hire help in the form of a personal organizer or personal concierge to run errands or handle yard work, which can free up time and energy for caregiving or other work or life responsibilities. Similarly, automating as many tasks as possible, such as grocery delivery and bill pay, can also free up time. And giving the caregiver a break is important: “You have to spend a little on respite time for yourself, even if it’s a few hours a week to get a massage or a haircut. That’s an expense many caregivers aren’t willing to make, but they’ll pay a bigger price for it later,” Scott says.
3. Try to avoid quitting your job. Nell Lake, author of “The Caregivers: A Support Group’s Stories of Slow Loss, Courage, and Love,” says it can make more sense to hire help if it enables you to maintain your career as well as health insurance and other benefits. She points out that 1 in 10 caregivers quits a jobs to provide full-time care to an elderly family member, which on average costs more than $300,000 in lifetime wages, Social Security and pension income.
4. Check up on public benefits. Veterans (and spouses) might qualify for certain benefits, and other government programs, including Social Security, Medicare, Medicare Part D Extra Help Program and Medicaid, are also available to those over age 65 or under the federal poverty limit. Lake recommends the website BenefitsCheckUp.org as a resource.
5. Investigate long-term care options. Lake points out that long-term care can be complicated, and people with accumulated assets often must spend them first before qualifying for Medicaid coverage of nursing home or in-home care. An elder law attorney can often help caregivers better understand the current and future expenses and how to minimize them in the long run, she says.
Planning ahead as much as possible, even more after the potential caregiving needs are known, can also help caregivers and their loved ones prepare to handle the financial cost of what’s to come. “The more we all think about and plan for our own and our loved ones’ possible long-term care needs, the more prepared and less stressed we’ll be,” Lake says.
Editor’s note: Kimberly Palmer wrote this article through a Journalists in Aging Fellowship, a collaboration of New America Media and the Gerontological Society of America, with support from AARP.