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The Impact of Caregiving on Health and Finances


Those who serve as caregivers to elderly relatives need no reminder of the potential toll it can take. For the rest of us, a new report from AARP Public Policy Institute may prove instructive.

Titled “Valuing the Invaluable: 2011 Update, The Growing Contributions and Costs of Family Caregiving,” the report quantifies the emotional and financial stress many caregivers experience.

According to the report, one in four adult Americans serve as caregivers to an elderly relative, friend, or spouse experiencing difficulty managing daily activities. In 2009, that translated to about 42.1 million caregivers at any given point in time. “Since some episodes of caregiving begin or end during the year, the total number of individuals providing care during the year is significantly higher, estimated at 61.6 million,” the report adds.

The profile of a typical caregiver is not surprising. She (some 65% are women) is 49-years-old and works outside the home.

Here’s where the stress comes in: She spends nearly 20 hours a week providing care–juggling such tasks as administering medications, providing transportation, and serving as a health care advocate with responsibilities to an employer and other family members. The average caregiver does this for five years. Phew…..

It’s not surprising, then, that the report finds that caregiving can take a considerable toll on the caregiver’s physical and emotional health:

  • 69% of caregivers responding to an online survey said caring for a loved one was their #1 source of stress.
  • A “review of studies” suggests that about 25% to 50% of caregivers meet the diagnostic criteria for “major depression.”
  • An estimated 17% to 35% of family caregivers perceive their health as fair to poor–a higher range than noncaregivers report.

There are also many signs that those taking on this role experience financial stress. Some even make sacrifices that could potentially compromise their own retirement security:

  • One study found that in 2009, about 27% of caregivers reported a “moderate to high degree of financial hardship as a result of caregiving.”
  • A recent survey found that 60% “were concerned about the impact of providing care on their personal savings.”
  • 21% say that caregiving “strains their household finances,” with 42% of caregivers spending more than $5000 a year on caregiving expenses.
  • Almost 70% report “making work accommodations,” including leaving early or taking time off.

Those who reduce their hours or quit sacrifice future wages and benefits. According to a recent study, those who leave the workforce forfeit about $116,000 in wages, $138,000 in Social Security, and $50,000 in pension benefits. “These estimates range from a total of $283,716 for men to $324,044 for women, or $303,880 on average,” the AARP report says.


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About Encore

  • Encore examines the changing nature of retirement, from new rules and guidelines for financial security to the shifting identities and priorities of today’s retirees. The blog also explores news that affects retirement, from the Wall Street Journal Digital Network and around the web. Lead bloggers are reporter Catey Hill and senior editor Jeremy Olshan. Other contributors include The Wall Street Journal’s retirement columnists Glenn Ruffenach and Anne Tergesen; the Director for the Center for Retirement Research at Boston College, Alicia Munnell; and the Director of Research for Pinnacle Advisory Group, Michael Kitces, CFP.