Millions of families are spending thousands of dollars to care for their loved ones, with caregivers spending an average of $11,508 out of pocket this year. This increase is nearly 60% from $7,242 five years ago, according to a study by AARP.
The study, conducted in June and July, surveyed over 2,500 adults who provide care to an adult relative or friend. The increase in costs may be due to caregivers purchasing more or different types of support, covering a greater share of care-related expenses, or managing more intensive care needs.
Caregiving Expenses
Household expenses, such as food and housing, accounted for 42% of caregiving expenses, followed by 29% for medical expenses. AARP found that 37% of medical expenses were for copays, coinsurance, insurance premiums, and direct payments to providers, while 19% were for nursing homes.
Tamara Johnson, a caregiver in her 50s, had to quit her corporate leadership job to care for her husband after a major stroke. His care costs quickly became a significant share of their combined income, which decreased from almost $200,000 to $50,000 in medical disability retirement.
Caregivers who got second jobs or increased hours at their current jobs had the highest out-of-pocket costs. Caring for someone with dementia can be even more costly, with caregivers spending an average of $5,600 more out of pocket than those caring for loved ones without dementia.
Wendy Rowland, a caregiver in her 50s, relocated from Tennessee to Mississippi to help pay for her husband’s long-term care after he was diagnosed with early-onset Lewy body dementia. His facility costs $6,750 a month. Because he hasn’t reached the age when he could claim Social Security, he receives $2,700 a month in disability insurance, which falls way short of his monthly care costs.
Caregivers with a relative or friend in a nursing home spent, on average, half of their annual household income on caregiving expenses. The AARP study highlights the need for support and resources for caregivers, who often have to make significant financial sacrifices to care for their loved ones.
