Caregivers Don’t Have to Figure Out the Finances on Their Own

Having trouble starting a tough conversation about caregiving with your loved one?

You are not alone. Some 1.5 million Virginians provide care for a family member or someone close to them. Seven out of 10 of them are also holding down other jobs.

The webinar, Social Security Tips for Caregivers, sponsored by AARP on November 14 and hosted by AARP volunteer Iris James from the Norfolk area, featured two experts in paying for care through government, community and personal means. They provided practical ideas for those online on how to get started in this process.

Susan Caicedo-Corea, a program manager in Financial Resilience at AARP, is responsible for savings and planning initiatives that educate consumers on financial security and retirement planning. She is also a caregiver herself.

Jammie Lyell, formerly with the Social Security Administration, is program manager for initiatives at AARP designed to enhance Social Security for millions of Americans.

Those who help someone with care in their later years, Caicedo-Corea pointed out, spend an average of $7,242 each year on caregiving expenses. Three out of 10 dip into personal savings. And about one-half quit their jobs or have to reduce hours.

Caicedo-Corea said it’s difficult to have conversations about money across generations. She suggested choosing an experiment as a starting point. For example, ask the family member whether they purchased long-term care insurance, then ask to see what the policy covers. Bring other family members into the conversation. Seek out someone to act as a financial advisor.

Plan ahead. The median cost for an assisted living facility in the United States is $64,200 a year, if that becomes a necessary expense. AARP provides several tools to help families develop a plan for gathering these resources, including the organization’s booklet, Financial Workbook for Family Caregivers. This guide covers health and health planning, housing and transportation, budget planning, and resources that can be tapped.

The webinar highlighted six key ideas to create a plan to pay for the care of an adult family member:

• Insist on conversations. 
  
• Use a framework to help you plan. 
  
• Survey all available resources. 
  
• Build and use a budget. 
  
• Prioritize your own well-being. 

At the government level, there are a number of financial resources to check out. Social Security Disability Benefits provide a monthly income and funds to cover care costs. If a care recipient is a veteran or an active military member, there is significant coverage through the Veterans Administration; check out AARP’s Military Caregiving Guide. Those who qualify for Medicaid can take advantage of many aspects of care coverage, including short-term in-home and residential rehabilitation.

For assistance at the local level, AARP offers the AARP Guide to Public Benefits for state-specific information. The care recipient’s local community may provide home maintenance grants for aging in place, meal delivery programs through non-profits or faith-based organizations, or adult day programs to keep them active and socially engaged.

When individuals and families need to pay these expenses out of pocket, the care recipient may contribute through a long-term care insurance policy or annuity. The caregiver needs to be aware of the financial resources available as part of their advance planning. Sometimes, the caregiver, if employed, can take advantage of senior care employee benefits or utilize accumulated paid or unpaid leave.

Both Lyell and Caicedo-Corea strongly recommend that families consult professional advisors as they plan.

View the entire webinar on the AARP Virginia YouTube Channel.