Understanding the Sacrifices of Family Caregivers

About 44 million people, roughly 19% of the U.S. adult population, provide unpaid care to someone who is age 50 or older. The average age of caregivers is 50 and the average age of care recipients is 77. Most caregivers assist family members, usually their mothers.¹

Although many caregivers help their family members out of love, there is overwhelming evidence that caregivers pay a dear price for their compassion. Nearly half reported increased financial worries and having to use sick time or vacation hours to provide care (see table).²
One especially telling statistic: More than four in 10 caregivers said they felt as though they had no choice about whether to assume the role of caregiver.³ This may indicate that little or no preparation took place before caregiving began. Yet when it comes to their own potential need for long-term care, 55% of Americans say that their greatest concern is becoming a burden to family members.⁴
Fortunately, you can start developing a strategy today that could help you provide for your own care and avoid becoming a burden to your loved ones.

Recalculate Retirement Needs

The obvious reason for having to turn to family members for care is money — or, more accurately, a lack of money. The national average cost for nursing-home care is $74,208 per year.⁵ How likely are you to need specialized care? Forty-three percent of people who reach age 65 will eventually spend time in a nursing home.⁶
If your retirement-needs calculations don’t take the potential need for long-term care into account, it may be time to evaluate your options for covering the potential costs. If you have a family member who may need care, the earlier you begin to prepare, the greater the possibility that you may be able to reduce the effect on your own finances and lifestyle.

Talk About It

Whether you are a caregiver or a care recipient, a financial professional can open a dialogue that helps preserve dignity and harmony while also coordinating decisions about common concerns, such as which care options are appropriate, whether the care recipient should move, how to manage property and possessions, and how to handle legacy issues.
Because it could be years before you find out whether you need living assistance, the most prudent approach could be to assume that you will and to begin preparing now. If it turns out that you don’t need care, there’s no penalty for being prepared.

1, 3) National Alliance for Caregiving, 2009
2) Money, September 2010
4) Journal of Financial Planning, June 2010
5–6) 2010 Field Guide, National Underwriter (2009 costs, latest year for which data was available)

The information in this article is not intended as tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek tax or legal advice from an independent professional advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Emerald. © 2011 Emerald Connect, Inc.