If part of your client’s long-term care strategy involves their child being their primary caregiver if they become unable to take care of themselves, it’s time to help change that outlook.
Millennials are facing financial struggles that previous generations didn’t face, like higher amounts of student debt and rising housing costs that make the goal of home ownership harder to attain.2 While navigating these issues, the unexpected role of taking care of an aging parent is not something most millennials are equipped to do. According to a report from AARP on millennial caregivers, one in three of those who are employed earn less than $30k per year.3 Many are at a point in their lives when they are still working to build their careers, and the time and cost of providing care can affect their ability to earn and save for their own goals and retirement.
Many caregivers fall into the sandwich generation, those who have had to care for their own children in addition to helping an aging parent. But millennials may face other sets of challenges, including still living at home and struggling to become independent, or waiting later than previous generations to start a family.4 These dynamics can affect the social interactions they have with family members and their ability to provide long-term care.
Another issue is that while the number of people age 65 and older continues to grow, they may not have as many children as their parents did to potentially help provide care. Fertility rates dropped sharply after the early 1960s,5 and while it has remained relatively stable since the 1970s, the size of family households overall saw a decline.6 This means that, while in the past there might have been four kids to help share the responsibility of taking care of mom, now that might all fall on one child.
We all want to make sure our parents are taken care of and want to do what we can to help, but caregiving can take an emotional and physical toll. According to the most recent Caregiving in the U.S. report by AARP and the National Alliance for Caregiving, 23 percent of caregivers felt their health worsened due to caregiving.7 The stress the caregiver may experience can affect not only their own personal health but can also put a strain on the relationship with their loved one. Ideally, they would be able to manage the care and spend quality time with their family member, instead of worrying about the stress of administering care.
While many children may feel it’s a privilege to take care of their parents, the responsibility may be more than they can handle at this stage in their life. It’s important to focus on a strategy to receive the care that might be needed, without depending on a child’s ability to provide it. Preparing for long-term care should be a part of your client’s overall retirement strategy. Medicare and Medicaid provide limited benefits, so it’s important to look at the possible cost of care where they intend to retire and see how they’re prepared to fund it. A private long-term care solution may be another option to provide coverage after retirement.
2"Locked Out? Are Rising Housing Costs Barring Young Adults from Buying their First Homes?" Freddie Mac, June 28, 2018
3Brendan Flinn, “Millennials: The Emerging Generation of Family Caregivers,” AARP Public Policy Institute, May 2018
4Table 1. Percent Childless and Births per 1,000 Women in the Last 12 Months: CPS, Selected Years, 1976-2018, United States Census Bureau, 2018
5Fertility rate, total (births per woman) United States, The World Bank, 1960-2019
6Figure HH-6 Changes in Household Size, United States Census Bureau, 2020
7Caregiving in the U.S.,” AARP Public Policy Institute and National Alliance for Caregiving, May 2020