5 Hidden Costs of Family Caregiving
Nearly 10 million adult children are caring for older parents in America. The unpaid care they provide is estimated to be worth $375 billion dollars per year in a report by Indiana University.
Caregivers clearly take on their heroic role out of love and duty, but for many, cost is also a big part of the equation. A lot of caregivers believe that caring for aging parents themselves is more affordable than professional senior care. After all, the logic goes, assisted living communities and nursing homes are quite expensive, so it must be cheaper to do it yourself.
But this is often a miscalculation. There are many clouded costs to family caregiving that should be considered before committing to becoming the full-time caregiver for an older loved one. Being aware of these costs can also help non-caregivers appreciate the sacrifice caregivers make, and the profound importance of their role.
Here are the five hidden costs of caregiving:
1. Lost Wages
Family caregivers frequently have to leave their jobs, reduce their hours, or retire early. According to a poll of caregivers by Gallup, the majority of family caregivers report that their role has negatively impacted their career. Furthermore, the MetLife study mentioned above found that the average caregiver’s lost wages are $143,000.
2. Decreased Employability
Caregivers who leave the workforce for months or years often find that it’s difficult to get another job when their time as a caregiver ends. This challenge is particularly marked because high unemployment has created an extremely competitive labor market
3. Increased Health Care Costs
Caregiving is physically and mentally taxing. Gallup researchers found that caregivers have both worse physical and emotional health than non-caregivers. What’s more, a study by the Center on Aging found that more than 1 in 10 caregivers say that the role has caused their own health to decline. This translates into increased healthcare costs for family caregivers, particularly those who have lost their own health insurance because they left their job to become caregivers.
4. Lost Savings and Retirement
Out of pocket expenditures by caregivers can really add up. A study by the National Alliance for Caregiving and Evercare found that a stunning 47% of working caregivers reported having used up all or most of their savings. Naturally, caregivers who have left the workforce altogether will have an even more difficult time maintaining their savings and retirement funds. Leaving the workforce can also reduce your social security benefit.
5. Reduced Productivity
The costs of caregiving are not solely on the caregiver. The American economy itself is also impacted. MetLife found that American businesses lose an estimated $34 billion each year due to employees’ need to care for aging loved ones.
Where Do the Hidden Costs Originate?
One reason that caregiving is so costly is that, according to MetLife, caregivers typically underestimate the amount time they will be providing care. We might imagine ourselves providing care a few hours per week for a couple of months, but end up providing care a few hours per day for a couple of years. Leaving the workforce for two months may be tolerable, but leaving the workforce for a couple years can be financially decimating.
A Way Forward?
The immediate burden of caregiving may be obvious, but the long term costs are now beginning to be understood as well. How can these costs be mitigated? A report by AARP’s Public Policy Institute made several recommendations:
- Implement family-friendly workplace policies such as flextime and working from home.
- Preserve and expand protections of the Family Medical Leave Act.
- Expand funding for the National Family Caregiver program.
- Provide a tax credit for caregiving.
- Pay family caregivers through Medicaid or other publicly funded programs.
There are no easy answers to this conundrum, but we believe it’s important have a conversation about the vital and honorable role of family caregivers, and what can be done to make their lives easier.
How has caregiving impacted your own family? Were their costs that you did not anticipate? What should we do to help family caregivers? Share your suggestions with us in the comments below.
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