Many of us have been a caregiver while we were raising children, now some of us are caring for a loved one out of necessity as the older family member is no longer able to care for themselves. A recent 2017 Transamerica Center for Retirement Studies report indicates that 42% of Generation Xers and 42% of Baby Boomers are caring for a parent, and 57% of Individuals born before 1946 are currently caring for a spouse or loved one. Care recipients suffer from a wide range of conditions, with half having a permanent one. The five most common conditions are arthritis, dementia/Alzheimer’s disease, high blood pressure, diabetes, and depression and or anxiety.
Caregivers help with a wide range of duties such as household chores, social and companion needs, health-related and personal care, and managing finances. Caregivers are also the bridge between Medicare or Medicaid services, and many learn medical and nursing tasks from professionals to better care for their loved one. If you are caring for an adult family member (other than a spouse), discuss what legal documents are required to represent that individual legally with a professional.
Where does that leave the caregiver in regards to employment and saving for retirement? The report indicated that half of caregivers are employed with many trying to maintain full time employment. However, over 76% reported they have had to adjust their hours or are planning to leave their jobs. Many in the survey expressed that they didn’t consider the financial implications of becoming a caregiver. If you are a caregiver or think you may become one for an adult family member, this should be a part of your financial planning process.
In the same way that a financial plan recommends reducing debt and saving more for retirement, a financial plan can be done to show working year’s savings and years of no savings and what that may mean for you. When you become a caregiver, not having to liquidate savings to provide care to someone will make a significant impact on your retirement.
If you think you may have to care for someone and leave your job, having no debt is essential. Becoming a caregiver is a life-changing decision and remember to plan for yourself. Your plan should include considering long-term insurance so that when you need care you have the resources to do so. If you are or may become a caregiver, please contact our Las Vegas Financial Advisory office for a meeting so that we can help you financially plan for this phase of your life.