Although many of us stress about our own financial futures, and the associated costs of retirement, it is easy to forget the enormous costs caregiving of a loved one can have on our personal finances. Loved ones are there for us throughout our entire lives, so we want to be there for them later in life. Because of this, we find ourselves doing whatever we can to help, however, it is imperative to balance the finances of both caregiver and loved one in need.

One of the largest obstacles is the continuing rise of healthcare costs. In fact, a healthy 65-year-old couple retiring in 2019 could have expected to spend more than $387,000 for just retirement health care costs, which does not include long-term care!

Long-term care is often one of the largest expenses; often loved ones step in to assist. Although this may lower the financial burden of the loved one in need, it can also leave a lasting impact on the caregiver’s finances themselves. In fact, annually it is estimated in the United States family members will provide $642 billion worth of unpaid care for our spouses, parents, and relatives each year. This significant value of unpaid services ultimately leaves someone underpaid. Caregivers are susceptible to lower paying jobs, and less flexibility of work times to meet the needs of their loved one. This often leads to a degradation of their own finances and quality of life. 

Although it is likely inevitable, and many of us want to care for our aging loved ones in need, proper management can save our financial, social and mental health significantly. Programs like the VA’s Caregiver Support Program, NCOA’s Benefits Checkup, Medicaid’s Cash & Counseling Program, state programs and income tax benefits are all programs and tools to help caregivers. They provide tax benefits, direct credits and planning tools. These, along with proper long-term care insurance, legacy planning, and a host of other financial instruments provide both the caregiver and aging loved one the financial stability to continue their lives without causing a financial nightmare for either party.

Pennsylvania Caregiver Support Programs

Although caretaking can be extremely costly, the many caretaking programs available can be saviors of finances and the multitude of stressful and complicated situations late life care often brings. Programs vary across the United States, but in KCA Wealth Management’s community, in Pennsylvania, the Pennsylvania Department of Aging provides extensive resources. Eligibility of course varies, but nearly any individual over the age of 18, caring for someone over the age of 55 is eligible. Some of the available resources include:

• Care Management
• Benefits Counseling
• Caregiver Education and Training
• Reimbursement for ongoing expenses for caregiving-related services or supplies, such as:
• Respite Care
• Consumable Supplies
• Supportive Services
• Supplemental Services
• Home Modifications
• Assistive Devices
• Services specific to grandparents/older relative caregivers (55+)

There are also various educational resources for both caregivers of adults and caregivers of children including legal, medical and psychological support.

United States Federal Caregiver Support Programs

USA.gov is a central location and authority on support programs. hosts a variety of caregiver support programs. They include, but are not limited to:

• Alzheimer’s Caregiving - from the National Institute on Aging
• Caregiver Resources - from The National Institute of Health
• Caring for the Caregiver - from the National Cancer Institute on caring for those battling cancer. 
• Managing Someone Else’s Money Guide - from the Consumer Financial Protection Bureau. 
• VA Caregiver Support Line - for those caring for veterans. 
• Office on Women’s Health Caregiver Page - prevent or relieve caregiver stress and paying  for home health care services.

In addition, there are a multitude of programs directed at financially supporting caregivers by providing stipends, grants and direct payments for the services they provide their loved one. They include:

• Medicaid Self-Directed Care program provides caretakers decision-making authority over certain services and provides a multitude of support services.
• The Veteran-Directed Home and Community Based Services program offers veterans a flexible budget. This allows them to choose the goods and services they find most useful, which can include hiring a family member/loved one as a personal care aide.
• The Aid and Attendance benefits for veterans works in conjunction with a VA pension. These benefits also often help cover the costs of a caregiver.

Oftentimes, Long-Term Care Insurance can help significantly, but it is always essential the fine print be read. For instance, a multitude of policies do not allow payment of family member caregivers who also reside with the individual for whom they are providing care.

All in all, there are a plethora of services, programs and financial programs for loved ones providing caregiving services. However, it is essential to create a concrete plan during the stages of your estate planning, which should be made well in advance. Many individuals make the mistake of waiting too long, which often puts additional strain and pressure on the family and caregiver themselves. At KCA Wealth Management our mission is to provide our clients with the highest level of service while helping them reach their financial destination. We will help you develop, implement, and monitor a strategy that’s designed to address your individual situation.