NPR investigates the true cost of giving up a job to be a family caregiver
Many of who have vulnerable loved ones would prefer to provide hands-on care ourselves. For some, that means considering whether to continue with outside employment or quit a job to care for our loved one full-time. In Discovering The True Cost Of At-Home Caregiving, NPR’s series “Family Matters: The Money Squeeze,” the lifetime cost of quitting a paying job to care for a loved one in the home is closely examined.
Given the cost of hiring in-home care or placing an elder in assisted living or a nursing home, the idea of staying at home to care for a loved one can seem cost effective. Sometimes by cutting corners, a family can survive financially for a few years while one spouse stays home to care for an aging parent. Doing so can seem like a humane choice, one that speaks of love and filial responsibility. However, the NPR report forces us to take another look.
NPR reports on a survey published by MetLife that calculates the costs of caring for our elders in various environments, including nursing homes and family home care. According to the NPR article:
“…the typical woman, the lost wages due to dropping out of the labor force because of adult caregiving responsibilities averages nearly $143,000. That figure reflects the wages lost while not working — typically for about five years — as well as lower wages after returning to the workforce with rusty skills. When foregone pension and Social Security benefits are counted, the out-of-pocket losses roughly double.”
While most people can calculate the lost wages he or she will incur after leaving a job for family caregiving, they rarely calculate the loss of Social Security earnings meant to prepare wage earners for retirement, as well as the 401K matching funds an employer may contribute. Yet, the lost Social Security benefits alone can be so significant that older boomers, once a parent dies, often need to return to work – sometimes at a lower pay level than before – in order to build their own Social Security payments to even minimal standards.
Another problem that stems from leaving employment for even a few years is that while the caregiver is out of the workforce, not only is he or she aging, but job skills are deteriorating. Needs in the workforce change at lightning speed these days, so it doesn’t take long before skills kept sharp through a paying job grow old. Often more education and re-connecting with the business world is necessary before a caregiver is qualified to re-enter the workforce.
Before quitting a job it’s necessary to look at all angles
Does this information mean you shouldn’t quit the workforce under any circumstances in order to care for aging parents? Not necessarily. However, it does suggest that you consider the total financial cost very carefully. Look at all angles from lost opportunities to invest for your own future to losses in Social Security earnings.
The days when people would inherit a modest amount of money from their middle class parents are pretty much past. Many of our elders, even after years of home care, spend a significant amount of time in a nursing home – enough time to spend down their assets. People can’t count on being “paid back” for their parent care, though of course some do inherit enough money to fill in the lost wages. But with people living longer than ever – often sicker than ever – some expensive facility care is frequently in the future for elders who become too impaired for home care. Under these circumstances, it doesn’t take long for modest savings to evaporate.
Families face tough choices when it comes to elder care. Practical planning can sometimes be at odds with the heart. One bright spot is that there now are many options for elder care. Also, in most parts of the country nursing homes have evolved into far better places to live than in the past. If we find that we can’t quit a paying job to be a full-time caregiver, we may be able to find a facility that can provide excellent care while we work. Even if we seek outside help, we are still caregivers. We are just sharing the hands-on care with professionals.
Of course, paid caregiving in the form of in-home care, adult day care, assisted living or a nursing home is costly, and most of the elder’s assets could go toward paying for that care. Adult children must weigh the advantages and disadvantages of each scenario in order to decide what solution is best for their own family. It would be nice if there were a perfect answer – one that satisfies our hearts as well as ensures the adult children’s future. Unfortunately, many of us have to live with imperfection.
Geewax, M (2012, May 1) Discovering The True Cost Of At-Home Caregiving. Kainaz Amaria/NPR. Retrieved from http://www.npr.org/2012/05/01/151472617/discovering-the-true-cost-of-at-home-caregiving
The 2011 MetLife Market Survey of Nursing Home, Assisted Living, Adult Day Services, and Home Care Costs (2011, October). Retrieved fromhttp://www.metlife.com/mmi/research/2011-market-survey-long-term-care-costs.html#findings