How to Protect Your Retirements as a Caregiver
Will becoming a caregiver prevent me from putting money aside for retirement?
It’s a common question most people face when a parent or spouse needs extra care. We’ve seen an increase in adult children becoming caretakers to help cover their medical and living expenses, but what will that mean for you in practice? Consider these four tips when you find yourself in this situation.
Ask the right questions
Make sure you understand all types of care your loved one may need and consider their wishes and preferences. Would they prefer to live with you or in an assisted living home? Consider this carefully; decide if you will have the resources (time, money, etc.) to support them part- or full-time.
Plan ahead for employment change
When it comes to becoming a caregiver, will you have to go part-time at your job or take a leave of absence? Make sure you understand what this will mean for your monthly income and consider speaking with a financial planner so you see all outcomes.
Focus on your employer’s retirement plan if you’re planning to return to work
If plan to return to work, it’s wise to contribute as much as you can out of the gate to your 401(k). This is to make up for what you haven’t been able to put towards retirement while you were out and provide more stability for your retirement.
Leave emotions out of your decision
It’s hard to not do everything you can for your loved ones, but when it comes to the decision of becoming their caregiver, it’s crucial to ensure it won’t have a negative impact on your future. Emotions can lead to snap decisions, so leave them behind and make a clear-headed, objective decision when deciding if this is something you will be able to afford.
Becoming a caregiver is a selfless and often important task to take on for those special in your life. But at the end of the day, make sure you completely understand everything that goes into it and how it will impact your future and retirement.