Building retirement savings is an important aspect of financial planning for family caregivers.
Providing care for a senior parent is a time-consuming labor of love. It may also have an effect on finances, as family caregivers may decide to reduce their work hours, take an unpaid leave, or quit working altogether.
It’s common for financial planning for family caregivers to fall by the wayside as they concentrate on a loved one’s needs. And, as many as one in three family caregivers who are close to retiring are using their own savings to care for a family member.
There are strategies, however, to prevent compromising your retirement funds while taking care of a family member.
How Do I Improve My Retirement Savings While Caring for a Loved One?
- Start with a budget. Seek advice from a financial expert to build a plan that enables you to continue to set aside savings for retirement. It is essential to make saving a high priority in your budget, even if you can’t save the amount you did prior to taking on the position of caregiver. If you haven’t already, set up an IRA to help you make the most of tax benefits. Determine if your employer offers a company match for retirement savings as well.
- Consider other savings options. If you decide not to work outside of the home, see if you qualify for a spousal IRA. You can also explore an SEP (simplified employee pension) plan if you are doing freelance work or running your own business.
- Whatever you do, don’t wipe out your savings for your loved one’s care. Depending on your loved one’s financial state, they could be able to access benefits programs such as Medicaid or Supplemental Social Security. You may also have the option to claim the person as a dependent to receive a break on your own taxes. Using your own savings should be the absolute last resort.
Financial planning for family caregivers is essential. Although the immediate needs your loved one is experiencing might seem to require your full attention, carve out time to make your own long-term planning a priority as well.
Your financial advisor can help you to develop a retirement plan that includes consideration for future long-term care needs. A long-term care insurance plan, for instance, can help with the cost of in-home care services if the need arises.
How Do In-Home Care Services Help Me Prepare for My Retirement?
Working with a home care provider, like Live Free Home Health Care, serving Concord, Belmont, and the surrounding areas, allows you to achieve an ideal balance between earning an income and caring for a loved one. You can decide how much time to dedicate to working while knowing your loved one is receiving exceptional care, additional opportunities for socialization and fun outings, and much more.
Our highly trained and knowledgeable caregivers are here to help as much as needed, whether just a few hours every week, 40 hours or more to allow you to work full-time, or even 24 hours a day, around the clock. Let us help both you and the person in your care set and achieve new goals. Contact us at 603-217-0149 to learn more about how we can help!