Family caregivers struggle with out-of-pocket costs: 8 things to know

Family caregivers, on average, spend roughly $7,000 annually on out-of-pocket costs related to their work, according to an AARP study out Monday.

For the study, researchers used a mixed method approach that included both a survey and diary component. This study was conducted from July 18 to Aug. 28 among 1,864 family caregivers using GfK's national, probability-based online KnowledgePanel.

Here are eight study findings.

1. Seventy-eight percent of caregivers incur out-of-pocket costs due to caregiving. 

2. According to a financial strain measure (annual caregiver expense divided by their annual income), caregivers spend, on average, nearly 20 percent of their income on caregiving activities, the study found.

3. The largest expenditure for family caregivers' are household expenses (41 percent of total spending), according to the study. This includes rent/mortgage payments and home modifications among others. Medical expenses account for the second largest share of caregivers' spending (25 percent), which includes assisted living or skilled nursing facilities, insurance costs and other medical expenses.    

4. Long-distance caregivers, or family caregivers living more than one hour from the care recipient, incurred the highest out-of-pocket costs ($11,923); however caregivers living with their care recipient also incurred high costs ($8,616).

5. The study also found the age of the adult being cared for influences the cost of care According to the study, caring for an adult older than 50 results in slightly higher out-of-pocket costs than caring for an adult younger than 50 ($7,064 compared to $5,721).  

6. Caring for an adult with dementia also resulted in higher out-of-pocket costs ($10,697 compared to $5,758 for adults who do not have dementia).

7. Fifty-six percent of employed caregivers experience at least one work-related strain, the study found. This may take the form of working different hours, fewer/more hours, and taking time off (whether paid or unpaid).

8. Many family caregivers are forced to cut back on other spending, which can undermine the caregiver's future financial security, the study showed. One in six have reduced contributions to their retirement savings and roughly half cut back on spending for leisure activities like eating out or vacations as a result of caregiving expenses.  

 

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