Millennials With Aging Parents Face Financial Hardship

Millennials want to take care of their parents, but at what cost? An article recently posted on Yahoo News explains the financial burden that is placed on millennials taking care of their aging parents.
 
Living through multiple recessions and bouts of inflation, most millennials are not ready for the extra cost of providing for their parents. The burden of providing financially for aging parents as well as acting as caregivers has left one-third of workers ages 62-66 having no retirement funds. 
 
“A Goldman Sachs report found that 79% of millennials expect caregiving to undermine their own progress toward retirement goals, while 72% predict that they will lose earnings and career momentum due to caregiving,” reported Yael Bizouati-Kennedy of Yahoo News. 
 
Financial planner Lemar Williams suggests that families get together once a year to discuss finances and plans for aging parents and how to manage their care and bills.
 
RBC Wealth Management suggests five big expenses that come with aging:

1. The cost of private home care (i.e., paying an aide to be with parents for certain amount of hours each week can cost over $100,000 annually)
2. The cost- financially and emotionally- to family caregivers (i.e., financial burden unpaid family caregivers, burn out)
3. The cost of renovating to age at home (i.e., making a home suitable for elderly living can have a high cost depending on what is needed)
4. The cost of private residential care (i.e., monthly costs for nursing home care can vary, but is likely to be costly if not using Medicare/Medicaid)
5. The cost of living longer (i.e., the longer you live, the longer the care is needed, and the more funds needed to cover bills and other expenses)

 
Goldman Sachs also found that a third of millennials, on average, have only saved a little over $3,000 to cover the costs of care for their parents. Even with long-term care insurance, the financial burden can be quite impactful on individual goals (i.e., buying a house).
 
With the rising costs of living and home care, it is important to be prepared for the inevitable. Millennials can help prepare themselves, for taking care of their parents, by having discussions with their parents regarding the expectations for financial support. 
 
Additionally, for those millennials that have had to begin providing for their parents, 43% reported that they had to take time off work and 64% stopped adding to their retirement fund and had gone through some of their savings. Bizouati-Kennedy explains that millennials can help themselves while assisting with their parents’ expenses by maintaining a good credit score.

You can check out the rest of the blog posts on our website and contact us if you have any questions about home care for your loved ones.

​Written by Madison Chalmers

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