Why you need to talk about caregiving

As the U.S. population ages, the caregiving experience is becoming more common. Today, more than 1 in 5 Americans provide care for an adult or child with special needs.¹

Adam Felts, a researcher with the MIT AgeLab, focuses on solutions to the challenges of family caregiving and the role that financial services has in helping people plan for long, fulfilling lives. While caregiving can be a loaded topic for many families, it’s a critical component of financial planning as it relates to well-being, he says.

“Planning for caregiving is primarly an interpersonal task,” Felts said on Episode 18 of the Truist Wealth podcast, I’ve Been Meaning To Do That. “It involves talking with our family members about what we want and what they want while being clear about our expectations.”

Communicating your values

Often, people will try to deflect conversations about future caregiving wants and needs. “It can be really hard for people to talk about a situation in which they or a family member no longer have complete autonomy,” Felts said.

However, getting over that barrier and having these conversations early can help you and your family members be better prepared if that day ever comes. A starting point should be some fundamental questions, Felts said. “Who in my family do I expect to take care of me? Where do I want to live if I require care? What are the things that I value most and want to preserve if I start to lose some of my independence and need caregiving?”

Communication and negotiation can be just as important for family members who are already in a caregiving relationship. Remember, however, that at this point, the situation may already be highly emotional. “Patience is the key virtue when it comes to caregiving,” Felts said. “And that’s because of this interplay between two people who each have their own preferences and their own values.”

Addressing the direct and indirect costs of caregiving

Professional care support and assisted living or nursing care may be among the biggest costs to consider in any discussion of caregiving. These can be major expenses, whether the family member is receiving in-home care or moving to a specialized facility, and the rules for paying for that type of care are often complex. Felts said that’s especially true if you plan on using public health insurance programs like Medicare, which doesn’t cover caregiving-related costs or assisted living, or Medicaid, which does only under certain conditions.

For in-home care, along with direct costs for technology-based products and services—including Wi-Fi and specialized tools designed to help patients with conditions like dementia—it’s important to consider indirect costs. If a family member is taking off work, declining promotions, or putting their career on hold to serve as a caregiver, the “opportunity costs” could be significant, Felts said.

For mothers, caring for children and aging parents, in-laws, and spouses can reduce lifetime earnings by 15%, according to a study by the U.S. Department of Labor.²

“That’s a major financial impact,” he said. “There’s also a psychological cost in that it becomes harder to invest in one’s future when the present is full of a demanding responsibility such as caregiving.”

Getting help from your advisory team

Speaking with your Truist Wealth advisor can help you find solutions to many challenges associated with caregiving, including the costs related to health care, long-term or memory care, and various types of insurance. Financial professionals should also be prepared for a deeper discussion of the issues surrounding caregiving.

“An advisor has the ability to hold a mirror up for a client,” said Oscarlyn Elder, host of the Truist Wealth podcast, I’ve Been Meaning To Do That. “That can help the client to better see something that they wouldn’t otherwise want to address directly. With caregiving, we’re trying to help people facilitiate those conversations earlier so that outcomes can be better.”