A financial strategy for caregivers

Caring for a loved one at home can put a severe dent in your savings. There are a myriad of government services available – it’s just a matter of finding them.

Over the years, the Samuels* were doing what hundreds of thousands of other seniors do: enjoying their retirement in a cosy condominium while fighting off aches and pains. But everything changed in March 2007 when Fred, 85, had an aneurism and was no longer able to walk and care for himself.

“I couldn’t believe how fast he went downhill,” said his wife, Sandra, 75. “I guess that’s what people don’t realize. When the elderly become ill, their health disintegrates very quickly.”

As Fred’s stay in the hospital went from weeks to months, Sandra began to map out a health-care strategy. Were the Samuels going to select a long-term care facility or try home care? With both decisions, the shadow of cost was not far behind.

The Samuels are part of the growing number of aging Canadian couples who wake up one morning and discover that one of them is now an informal caregiver and financial manager. Research indicates that between 75 and 90 per cent of home care is provided by informal caregivers.

The Samuels are mortgage-free, have no debt to speak of and have a monthly income of about $3,800 from Canada Pension Plan, Old Age Security and small private pension plans. A basic long-term care room for Fred is about $1,500 a month; a semi is $1,700 and a private is $2,061. The Samuels have limited savings and no long-term care insurance. Their property taxes are going up as are their condominium fees. Worse, the waiting list for any room could be up to four years.

“Back in our days, it never occurred to us to save for nursing home costs. There weren’t nursing homes when we started out. People looked after their own because there was extended family. Now you don’t have that,” says Sandra.

The Samuels preferred a home care solution in which Sandra would be the informal caregiver, but with lots of help. She would need it. She has pressed vertebrae and arthritis and is recovering from two heart attacks.

“What I’m hoping is – I know this is a faint hope – that maybe Jim can get up and get walking and come home. My biggest plan is to get him home and get him out of this situation because he hates the hospital,” says Sandra.

But for many, the home-care solution is financially and physically daunting. Sandra estimates that it could cost up to $160 a day for part-time help. Accidental caregivers are often surprised when they hit a universal health-care system dead end.

“We do in some respects have an assumption about health care being provided that it’s a universal program that everyone has access to,” says Bonnie Schroeder, caregiver project manager, VON Canada. “But home care and community care are really not included as part of that.”

Nevertheless, to the determined sleuth and the savvy financial thinker, the road to successful home care can be less of a financial curve ball than one might think. If one is going to be an informal caregiver – or a user of a long-term care facility – and is looking for a soft financial landing, the first place to look is in a current or past employee benefits handbook. There might be some pleasant surprises.