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How to avoid financial loss when taking care of a family


How large financial costs can be borne by taking care of a family? Amy Goyer, AARP family and care specialist, said the costs of caring for her parents led her to file for bankruptcy.

“I wish I had met a financial advisor in the first place, who would get me on the right track and be able to steer me in different directions that would avoid bankruptcy,” said Goyer, based in the region. Washington, DC, says. me in a recent episode of “Money-talking friends“Podcasts that I co-host. (You can listen to episodes wherever you get podcasts.)

When the cost of taking care of a family is staggering

Goyer has been a caretaker for the family throughout her adult life. In her 20s, she helped out her grandmother, who had Alzheimer’s disease. In recent years, she quit her full-time job at AARP to help her mother with a stroke and later her father with Alzheimer’s (both moved to her home), as well as her sister Miss. Goyer knows how to keep them healthy. But the staggering cost of care, which turns into a staggering credit card bill, was something she was unprepared for.

Family care is also a financial disaster for Janet Harris, 60, of rural Stony Mountain, Ga., Who is unemployed after losing his job for 23 years at the American Cancer Society. Since 2019, Harris has supported her husband Alonzo, 75, a retired car salesman who has prostate and liver cancer and is now blind after having a stroke.

“I have no savings and no income, and I feel a little frustrated,” Harris said. “Honestly, I don’t know how I did it, from a $ 60,000 job to $ 365 a week unemployment benefits.”

Harris has borrowed money from family and friends. “I feel indebted,” she said. However, she added, it helped her get through her tough times financially. “God has returned me a bit of myself,” Harris tells me.

How a pandemic crushed caregivers

Their stories reflect things that many countries 48 million unpaid adult caregivers are going through, more difficult due to the pandemic.

A new survey published on April 8 by Hero, a drug management service, found that 56% of caregivers currently spend $ 10,000 or more annually to support loved ones and 26% spend more than 25,000 dollars. And a study by AARP and the National Alliance for Caregiving found that 28% of caregivers stopped saving last year and 23% had more debt. One fifth reported “high financial stress” due to care.

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(Below, I’ll give some money advice to caregivers from my “Friends Talk Money” co-hosts Terry Savage, Pam Krueger and our guests.)

In a global EMD Serono survey, 54% of caregivers reported The pandemic has worsened their financial health.

Lynn Taylor, head of global health care, government and public affairs at Merck KGaA, Darmstadt, Germany, known as the EMD Serono in the US, said: “We are witnessing an The already stressed population is becoming more stressed with the pandemic.

On “Friends Talk Money”, Krueger said: “During the pandemic, the world was turned upside down because millions of families suddenly found themselves needing to help their parents or a family member or even a single person. Your best friend is having a hard time. Suddenly and unexpectedly, you have to find a way to make life better for you and your parents or loved ones, not only financially, but emotionally.

Savage calls this “an intergenerational gift” that you can give to your parents.

At one Webinar on Project Longevity Care in the US I attended March 31, Terry Fulmer, president of the John A. Hartford Foundation (a Next Avenue sponsor), bluntly said: “We didn’t realize how serious the consequences were for family caregivers during the pandemic ”.

In her remarkable new book on caregiver exhaustion, “Already Toast,” journalist Kate Washington notes that she has lost $ 80,000 in income to be able to work less and help. her husband, Brad, who was diagnosed with cancer, recovered from a stem cell transplant.

Savage notes that quitting your job or cutting your working hours to be the caregiver can have long-term economic consequences. Your Social security She says benefits will be reduced and you will be less likely to contribute to your retirement plan. “That snowball is in the future,” added Savage.

Advice from experts

So, what can caregivers do to help protect their finances from being weakened while generously supporting loved ones? Here are some suggestions from my “Friends Talk Money” co-hosts and I, along with the experts we’ve talked to:

Organize your finances to keep track of your care expenses and keep track of the finances of the people you care for. AARP has a great new, free digital workbook on its website that does this, “Financial Workbook for Family Caregivers. “

Savage, a personal finance journalist and columnist, also has a helpful, four-page brochure Personal financial institution on her website. “I think you can use it as a template to do a scavenger hunt in addition to aggregating the documents you’ll need along the way,” she said.

Related: My 92-year-old mother fell down the stairs. Taking care is a nightmare

C. Grace Whiting, Executive Director of the National Coalition for the Care and Influencers of the Elderly on Next Avenue, recommends checking out the resources of WISER.org (Women’s Institute for Security Retirement Full) for those who care about planning and financial management. WISER has one Free guide There: “Caregiver Financial Steps: Things You Need to Know About Protecting Your Money and Retirement.”

And Next Avenue’s new range of free resources and tutorials, “Fast-forward: Take control of the rest of your life, ”Includes ways to get money management assistance.

Consider signing up for an app dedicated to taking care of money. For example, Carefull.com ($ 12.99 a month) sends you an alert if it detects the caregiver’s unusual financial transactions and has a bunch of helpful articles by fish finance writer and Cameron Huddleston’s former family caregiver.

Carefull CEO and founder Max Goldman told me that the financial aspect of taking care of the family “is not much talked about, but it is the lifeblood of the whole care experience.”

Speak frankly with your parents as soon as possible. It’s best to find out all they can about their finances, bills to pay and any long-term care insurance they have.

If your parents suffer from dementia and you haven’t had any money conversations with them, Huddleston offers this advice in “Friends Talk Money”: “You don’t want to put them on the defensive. a way of showing that they are no longer able to manage their money. It just makes them uncomfortable. ”Instead, she said, while visiting, say things like:“ Mom, I want to help me check the mail and sort out the trash ”or“ Mom, I can help you write some of those checks ”.

Goyer emphasizes the importance of drafting power of attorney documents, so you’ll be able to manage your parents’ finances if they can’t.

If you know that your mother or father has a long-term care policy and are having trouble with everyday activities like bathing, cleaning or dressing, get certification from your parent’s doctor, Savage says. this as soon as possible. Then, notify the insurance company, for the sake of the policy, may not go into effect until 100 days or longer after it authorizes payment.

“That way, by the time you need someone to be there full time, you are over the deductible,” Savage said.

Also read: How to protect loved ones from older adults’ financial abuse

And if you have grown kids, this might be a good time to start chatting with them about your financial situation in case they need to be. your caregivers, Savage advised.

Consider programs from government agencies that can lower your care costs. Harris was able to cut his utility bill through a program in Georgia this way. However, she notes, “You have to study it yourself.”

Harris also recommends joining the caregiver resource groups on social media to learn about money-saving ideas for caregivers.

Whiting has an important reminder to caregivers: “Take care of yourself. You are also important. “

Richard Eisenberg is the Senior Web Editor for the Next Avenue Money & Security and Work & Purpose channels and the Managing Editor for the website. He is the author of the book “How to avoid the financial crisis in the middle of life” and has worked as personal finance editor at Money, Yahoo, Good Housekeeping and CBS Moneywatch.

This article is reprinted with permission of NextAvenue.org, © 2021 Twin Cities Public Television, Inc. All rights reserved.

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