The Truth About Retirement Planning for Caregivers
How does caregiving impact retirement?
Family caregiving can cause both immediate and long-term financial stress. Many caregivers save less for retirement, use up their savings, and may have to retire early. This can lead to money struggles later in life.
Others may be forced to delay retirement for continued income while they try to manage caregiving expenses.
When Care Needs Delay Retirement: Laura’s Story
Laura had long dreamed of retiring at 60. She imagined spending quiet mornings with coffee and books, and traveling the world at a leisurely pace. But when her parents’ health began to fail, those dreams changed.
Now 58, she works full-time to help cover their increasing expenses. Some days feel long, but Laura finds peace in knowing she’s there when her parents need her the most. Still, she can’t help but think about what her retirement life could have been.
Family Caregiving and the Retirement Dilemma
What happens when caring for a loved one starts to change your retirement plans?
Many caregivers put their retirement savings on hold to pay for medical bills, step away from work or move in with an aging parent. About 32% of family caregivers stop or reduce their retirement fund contributions after taking on caregiving duties, directly impacting their long-term retirement security.
Caregivers who work while caregiving may have up to 90% less saved for retirement by age 65 than those who don’t provide care. This gap could mean working up to 21 extra years just to catch up.
If caregiving has impacted your ability to save, work, or plan for retirement, it’s okay to feel concerned. But there’s no reason to give up hope. You can still move forward.
Discover some practical caregiver tips to help protect your financial future while still attending to your loved one’s needs. You need peace of mind too.
1. Get a clear picture of your finances.
The first step is understanding exactly how caregiving is affecting your finances. Many caregivers don’t realize the full financial impact of caregiving until much later. Taking a closer look now can save you from stress down the road.
Ask yourself:
- Have I reduced my work hours or left a job?
- Am I dipping into my retirement savings to cover caregiving costs?
- Do I pay for medical supplies, home modifications or travel?
- Has my own health or financial stress gotten worse?
Once you answer those questions, write everything down. Create a simple list of your monthly expenses, caregiving costs and income. Then review your retirement accounts, Social Security estimates and any debt you may be carrying.
If it feels overwhelming, don’t do it alone. A financial advisor, nonprofit credit counselor or trusted friend can walk through the numbers with you. This step can be emotional, but clarity brings control.
Also, check to see if your loved one qualifies for benefits. Programs like Medicaid, VA Aid and Attendance, or state caregiving grants can help cover some of the burden.
Helpful resource: To explore what help is available in your area, visit BenefitsCheckUp.org.
2. Adjust your retirement goals — temporarily.
If caregiving has delayed or changed your retirement plans, try to think of this season as a temporary detour. You might need to push back your retirement date or change your goals, but it’s still possible to enjoy your future. Staying flexible is the key.
Consider:
- Working part-time or freelance to maintain your savings and benefits.
- Exploring remote or flexible jobs to fit around your caregiving schedule.
- Downsizing your lifestyle so your money lasts longer.
- Using catch-up contributions to your retirement savings if you’re over 50.
Also, remember that caregiving won’t last forever. Your role may change as your loved one’s needs shift or as more support becomes available. Planning for different outcomes can reduce your anxiety and prepare you for what’s ahead.
3. Set boundaries around money and time.
One of the hardest parts of caregiving is saying no. Many caregivers feel guilty when they can’t give more, even when it’s hurting their health or finances.
But boundaries protect both you and your loved one from burnout and breakdowns.
Start by being honest about what you can and cannot afford. Create a simple caregiving budget that includes:
- How much time you can realistically give
- What costs you’re willing and able to cover
- What support you may need from other family members
Then share your boundaries clearly and kindly with your family. You might say: “I love to help, but I can’t afford to cover everything. Can we work together on this?”
If others offer to help, let them.
4. Make self-care and planning a priority.
When you’re feeling overwhelmed, you often put your own needs last. But ignoring your health and future won’t make things better. Realistically, that approach only adds stress.
Make it a habit to practice a little self-care each day. You don’t need a fancy routine. Just simple steps like:
- Taking 10 minutes for deep breathing or prayer.
- Walking outside to get some fresh air.
- Writing down your feelings or goals in a journal.
- Eating a nourishing meal.
- Getting support from a caregiver group.
Also, set regular check-ins with your financial planner or even a trusted friend to talk about your retirement goals and what’s next. Use tools like a caregiving planner or journal to track expenses, appointments and ideas.
You can care and still prepare.
Family caregiving calls for sacrifice, but it doesn’t have to cost your future. By taking small, thoughtful steps now, you can support your loved one and still build your financial security.
Give yourself permission to adjust your goals, ask for help and take needed breaks. Your dreams are still worth protecting.
Caregiver Retirement Planning FAQ
Can I get paid for being a family caregiver?
In some states, caregivers can be paid through Medicaid or VA benefits. Check with your local Area Agency on Aging.
What financial help is available for caregivers?
There are options like Medicaid waivers, respite care programs, tax credits and nonprofit grants that can help reduce the financial load.
How can I save for retirement while caregiving?
Start small. Set up automatic savings, look into part-time work and ask about catch-up retirement contributions if you’re over 50.
What if I can’t afford to retire at all?
You’re not alone. Many people adjust their plans later in life. A financial advisor can help you explore new options and find peace in the process.
How do I talk to my family about money?
Be honest. Explain how caregiving is affecting you and ask for shared planning or financial support.
