More Americans are sacrificing their own needs financially to support elderly family members.
Sixty-seven percent of caregivers have reduced their living expenses to take care of a family member, up 16 percent from last year, says a study from life insurance company Northwestern Mutual.
Most Americans (57 percent) are aware of what it will cost to provide care to a loved one. However, 48 percent admit they haven’t planned how they will pay for it.
“In an environment of rising costs and fluctuating economic and healthcare realities, winging it isn’t an option,” says Northwestern Mutual vice president of long-term care Kamilah Williams-Kemp. “Being proactive before a long-term event happens can help ensure that you can still take care of your own needs while caring for someone else’s well-being.”
A caregiver’s expenses
The amount of Americans who don’t plan to take care of an elderly family member financially has increased by 13 percent since last year. While caregiver costs increase every year, according to the study.
Sixty-eight percent of those who aren’t prepared financially still support their elderly family member. The average costs for medicine and medical supplies is $273 a month, on average. While food costs them $159, monthly. Thirty-four percent of Americans use 21 percent-100 percent of their monthly budget to take care of a family member.
Despite witnessing a family member need long-term care, most don’t save for their own long-term care needs. More Americans believe they’ll need long-term care, than outliving retirement savings, or losing a job, according to the study. Still, 73 percent don’t plan for it, even though many see its importance. More than half (56 percent) of Americans say it’s a higher financial priority than paying down debt (55 percent), or saving for a home (30 percent).
It’s tough for Americans to plan how to take care of themselves in old age. Especially when most of us don’t talk about it.
Not planning ourselves
Many Americans have an idea of who they prefer as a caregiver, but they haven’t said anything about it.
Nearly half (47 percent) expect their spouse to take care of them, and 26 percent will look to their children. But, 69 percent haven’t told a family member, or anyone else about who they prefer to take care of them. On top of that, most Americans aren’t aware of what long-term care will cost them anyway.
Debt.com has previously reported that a nursing home costs Americans double what they think. Americans estimate that to cost $54,000 annually, when in reality it costs $100,000, according to Lincoln Financial Group.
Of course the more Americans know about, and plan, for long-term care — the better off they’ll be in old age. Bill Nash, a Lincoln Financial Group vice president, feels it’s in Americans’ best interests to start talking with family members early on about how to plan their long-term care.
“Long-term care planning is increasing in importance by the day with more and more people approaching or in retirement, and living longer,” Nash says. “Being proactive before care is needed can make a lasting impact on the quality of care you receive, the ability to maintain dignity, and on your family’s financial security.”
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