The unexpected cost of long-term care

Terry Savage, Tribune Content Agency on

It’s the one financial planning issue that everyone wants to avoid. Your retirement may go according to your financial plan. On the other hand, you and your family may face the unexpected cost of long-term care that is not covered by Medicare or Medicare Advantage plans.

This is the cost of getting help doing the basic activities of daily living: showering, toileting, dressing and feeding yourself. No one wants to think about being that needy.

It’s a financial problem that crosses multiple generations. Who is going to perform those services, and what is the true cost? AARP estimates the average family caregiver spends $7,200 a year on transportation and other unreimbursed caregiving costs. But not all costs are monetary.

Is your mother going to move into the bedroom in your home that was vacated when your child went to college? Can your dad live alone at home after your mother passes on? Can you stop by for a daily visit, or must someone be around full time, as in the case of dementia?

If you’re the one approaching that potential stage of life, your big question is whether you have set aside enough resources to cover these costs, without burdening your children. And those costs may be steeper than you imagined.

AARP’s latest report on family caregiving costs is titled “Valuing the Invaluable” ( The key finding is eye-opening: Since the previous report in 2019, there has been a $130 billion increase in unpaid contributions from family caregivers.


In fact, AARP estimates family caregivers provided 36 billion hours of unpaid care in 2021 – worth about $600 billion! That's in addition to the $7,200 the average caregiver pays in additional out-of-pocket costs for transportation and needs. Yet few, other than those directly involved, understand the impact and true long-term costs.

When a daughter steps out of the workforce to care for her parents, she loses her own retirement plan contributions along with future promotions and higher-paid years of covered Social Security earnings, all impacting her own chances for a successful retirement.

And it’s a problem that will only grow worse in coming years. According to the AARP report, adults age 65 and older will outnumber children under the age of 18 for the very first time. The sandwich generation of adults will certainly be squeezed by the cost of caring for both children and aging parents.

If the thought of multiple generations living under one roof makes you wince, there is always the alternative of assisted living or in-home care for your parents (or yourself). But those costs, too, are soaring. The pandemic revealed some of the frailties of state-run Medicaid programs, as state budgets were strained. And restrictions on immigration, along with childcare issues, have kept the labor market tight.


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