If you are suddenly faced with the prospect of providing care for a loved one, you are likely unaware of the costs involved with caregiving. According to MetLife, the total estimated aggregate lost wages, pension, and Social Security benefits of those serving as caregivers to their parents is nearly $3 trillion. There are numerous costs you can expect and need to plan for. However, you also need to plan for the unexpected, hidden costs of being a caregiver.
What Are the Costs of Caregiving?
For those working and serving as a caregiver, the loss of wages can be as drastic as the following:
- For women:
- The total individual amount of lost wages due to leaving the labor force early and/or reduced hours of work because of caregiving responsibilities equals $142,693.
- The total impact of wages, retirement benefits, and social security equals $324,044.
- For men:
- The total individual amount of lost wages due to leaving the labor force early and/or reduced hours of work because of caregiving responsibilities equals $89,107.
- The total impact of wages, retirement benefits, and social security equals $283,716.
- See the full MetLife Study here.
Other than lost wages, the cost of caregiving can include various out-of-pocket expenses, such as:
- All of the out of pocket expenses below can cost a caregiver approximately $4,570 to $8,728 per year (according to an Evercare and National Alliance for Caregiving study):
- Household goods
- Food and meals
- Travel and transportation costs
- Medical care co-pays and pharmaceuticals
- If needed, home renovation expenses to accommodate for mobility issues for your parent can cost on average $6,226. Read more about home renovation costs here.
- If required, hiring additional, professional home caregiver support can cost on average $21 per hour.
The largest financial impact on a caregiver can be the loss of wages as a result of having to take time off of work. This can also impact your employability down the road.
The cost of being a caregiver can be great. To prepare yourself for these costs you should research what tax benefits are available for you as a caregiver, as well as additional support if you or your loved one is a veteran. Discuss these costs with your family and budget properly for the expected and unexpected costs of being a caregiver.