The Pandemic Has Been Tough on Adult Caregivers. Personal Finance Expert Jean Chatzky Has Some Advice

A photo to accompany a story about pandemic caregivers Photo by Sarah L. Voisin/The Washington Post via Getty Images
In Rockville, Maryland, Maggie Gonzalez, 25, takes care of her grandparents, John L. and Susan duFief, both 85, at least 12 hours per week and sometimes more. Gonzalez, left, talks to her grandfather, John L. duFief.
We want to help you make more informed decisions. Some links on this page — clearly marked — may take you to a partner website and may result in us earning a referral commission. For more information, see How We Make Money.

Caring for loved ones isn’t just a great responsibility. It’s costly, too. 

Throughout a year defined by health and financial crises, 48 million unpaid American caregivers have faced extra financial strain, according to personal finance expert Jean Chatzky and data from the AARP.

Personal finance expert Jean Chatzky says the pandemic has created extra financial strain for caregivers.

Today, more than 1 in 5 Americans are unpaid caregivers; they provide assistance for adult family members, friends, or neighbors with health or functional needs. On average, caregivers spend nearly 20% of their own income on out-of-pocket caregiving costs, according to AARP data, totaling more than $7,400 each year. 

We recently spoke with Chatzky, a financial ambassador for AARP,  about the financial challenges of caregiving in a pandemic — and how caregivers can keep up with their financial goals while providing for loved ones.

Pro Tip

Take stock of your finances by starting with four primary questions about your money, Chatzky recommends: What’s coming in? What’s going out? Where’s it going? And how has that changed since before the crisis?

Family Caregivers in Crisis

Caregivers of adults join a growing number of people leaving the workforce to take on additional child care responsibilities at home. And women are disproportionately the ones forced to make that choice. 

Women are more likely to serve as caregivers for adult loved ones

Source: AARP Caregiving in the U.S. 2020 Report

Women represent 61% of caregivers, according to the AARP. Chatzky names a few reasons for the divide: traditional societal roles; women’s higher likelihood of pandemic-related job loss, especially during early lockdowns and among Black and Latina women; or the fact that women tend to earn less. When families are forced to choose, maintaining the higher income makes financial sense. 

“It’s a numbers game in many cases,” Chatzky says. “That’s just inescapable.” 

While the AARP and Chatzky advocate for legislative solutions — U.S. President Joe Biden’s proposed stimulus package would provide assistance for family caregivers, for example — and more flexible workplace leave policies, you can take action to protect your own financial future.

Caregivers Save Less, and Take On More Debt 

The costs of caregiving can often cause caregivers to fall behind on their own financial goals, according to AARP’s Caregiving in the U.S. 2020 study. Even before the pandemic, the study found 18% of caregivers faced a high financial strain as a result of caregiving. 

How caregivers’ finances have been affected by providing care 

Nearly half (45%) of all caregivers say they’ve experienced at least one of the following; 34% have experienced two or more:

Source: AARP Caregiving in the U.S. 2020 Report

But Chatzky’s concern is how much more prevalent the financial strain has become in the past year. “The pandemic has exacerbated all the obligations [for caregivers], both time and financial,” Chatzky says. “For many people, it’s been a 1-2 punch.” Many caregivers find themselves sandwiched between caring for kids at home in remote schooling while also dealing with the needs of older relatives or loved ones, she says. “It’s just been a huge financial blow.”

These are Chatzky’s recommendations for caregivers — and anyone facing financial hardship — to begin working toward financial relief today and planning ahead for the future. 

Rethink Your Budget — through the Pandemic and Beyond

Start taking control of your financial health by understanding what money you have, your expenses, and where the gaps are. 

“Harness your financial resilience,” Chatzky says. 

She recommends starting with four questions: 

  1. What’s coming in? 
  2. What’s going out? 
  3. Where’s it going? 
  4. How has that changed since before the crisis? 

Use your answers to begin rebuilding a budget that can take you out of the pandemic and into the future.

Even if you can get by for now, how might major lifestyle changes — downsizing to a more affordable home, for example — help you avoid greater financial strain later on?

As a caregiver, you also need a deep understanding of your care recipients’ costs, and how they may change the future. Consider how changes now may help you or your loved one save money later on. For instance, if you’re a caregiver to someone with mobility issues, would relocating to a more accessible home help prevent added costs down the road?

AARP offers a financial workbook to help you and your care recipient get a better understanding of costs and other important information related to their care. It includes advice on how to plan for costs related to legal services, insurance, and home spending. 

“[Your new budget] may involve a recalibrating of lifestyle on everything from major expenditures like housing to smaller ones like eating and entertainment when we’re allowed to do those things again,” Chatzky says. “Upcoming tax refunds and the anticipated next round of stimulus payments also offer an opportunity to rebuild some emergency cushion or provide a buffer to get us from here until the world opens up again.”

Look for Income Opportunities Beyond Your Career Track

More than a quarter (26%) of unpaid caregivers have lost income as a result of caregiving, according to the AARP study. That includes people who gave up work entirely, retired early, or reduced their paid work hours.

But if you’re facing financial hardship, any extra income can make a difference in your monthly budget.

“If you have the ability to get paid work, even if it’s not career-related paid work, I think this is the time to do that,” Chatzky says. Look for jobs that can help keep you above water, while  “recognizing that when the country opens up again and we are able to get back out of our houses and potentially back to our places of business, you’ll try to get back on track with that career.” 

You may even want to consider an outright career pivot when you’re ready to return to full-time work. “Start to look at where your skills line up with industries that are going to be hiring or are already hiring,” Chatzky says. If you need some additional skills, start taking steps now to get there, whether that means signing up for a class or brushing up your virtual network. 

Don’t Leave the Workforce If You Can Avoid It

“Before you re-enter, let’s try to consider not leaving,” Chatzky says.

The average caregiver spends nearly 24 hours each week providing care

Source: AARP Caregiving in the U.S. 2020 Report

The average amount of time caregivers spend providing unpaid care each week is more than the typical part time job. And more than 50% of caregivers say their time commitment has increased since the pandemic began. That time commitment is a large part of why caregivers leave the workforce in the first place, but working out a more flexible work schedule can make more sense for your money and time than starting a job search later on.

Chatzky recommends discussing flexible arrangements with your employer — “maybe you’re working part-time but you’re not off-ramping completely” — or even maintaining a consulting agreement. “That can be very helpful in terms of having a seat at the table when it’s time [to return full-time]. It’s easier when you’ve already got a foot in the door.”