November is National Family Caregivers Month, a time to think about the millions of Americans who take care of others. This year’s theme is “take care to give care”, a reminder that the first rule of taking care of others is to take care of yourself first. In acknowledgment of National Family Caregivers Month, WISER is publishing a series of blogs examining caregiving and the ways women can take care of themselves by planning for its financial impact.
Many people who are caregivers do not actively identify as such, and many are not even aware that they are part of a defined group. Do you care for an elderly parent or a disabled sibling? Do you stop by your neighbor’s house daily to help them with certain tasks, like measuring out medication or cooking? These may seem like common tasks that you do simply because it’s the right thing to do. However, caregiving is a time-consuming duty that warrants recognition. It can often take up as much time as a full-time job, yet isn’t paid, and can actually be a drain on your finances. Estimates suggest between 40 and 70 million Americans nationwide provide 37 billion hours of caregiving work each year.
Some of the jobs caregivers take on include:
-Home keeping duties like laundry, cleaning, cooking and shopping
-Medical tasks like picking up, dispensing and measuring medicine, aiding in medical decisions, driving to and from doctor’s visits and helping with medical tasks like physical therapy or changing feeding tubes
-Helping with end-of-life decision-making like writing a will or hospice care
-Financial tasks like banking and paying bills
In our society, caregiving duties frequently fall on women. According to the Family Caregiving Alliance, the “typical” caregiver is a 46-year-old woman who spends 20 hours per week taking care of her mother and also works outside the home. In total, about 61% of caregivers are women.
Caregiving duties impact finances in a number of ways. The time caregiving requires can cause people to work fewer hours at their jobs or decline promotions that require more time or travel. According the National Alliance for Caregiving, 70% of caregivers report making adjustments to work schedules to accommodate caregiving responsibilities. Making these sacrifices at work causes a reverse snowball effect: not only are you forfeiting pay, but also benefits, compounded return on 401(K) matching contributions, and investment opportunities. There are also a countless number of more subtle consequences, for example, you may not be able to pursue additional education and degrees that could increase earning power. Caregiving is also simply expensive: a MetLife study reports that caregivers pay an average of $5,531 annually in out-of-pocket costs.
The financial hit of caregiving also overwhelmingly impacts women. In combination with the other challenges women face- like the pay gap- the cost of caregiving puts women at a disadvantage when it comes to saving for retirement. The same MetLife study also showed that caregivers lost $303,880 in wages, Social Security benefits, and private pensions over their lifetime as a result of caregiving responsibilities.
Stay tuned for more blog posts this month about ways to avoid compromising your own financial security while caregiving. In the meantime, check out WISER’s Financial Steps for Caregivers booklet which includes lots of great information and resources to get you started.