Although my husband and I tend to be habitual tightwads, I was in grad school at the time of Dad’s unplanned move into our home which rocked my carefully constructed grad student plus one working adult budget. The galvanizing event was a nearly $400 water bill, right around the time my tuition bill was due, because of the extra laundry my father generated. Not only did our utilities suddenly rise, we also had an extra mouth to feed, higher fuel costs for near weekly doctor’s visits, and every other little expense imaginable.
The average family spends some $5000 per year on unreimbursed caregiving expenses for their elderly loved ones, with some families spending considerably more. Costs are incurred for home modifications like grab bars in the bathroom. Many elderly people have incontinence problems and this leads to extra loads of laundry, thus higher utility bills. Extra wear and tear on vehicles increases transportation expenses in addition to increased gas usage. Family outings are increased by small expenses such as wheel chair rentals at venues like zoos and county fairs, which range from $10-25 per day. Vacation costs are increased by needing to rent 2 hotel rooms to guarantee privacy, and ability for the non-caregiver family member to sleep, whilst the caregiver works during the night with the elderly person. Hiring caregivers will cost a family on average $25 per hour, or $385 per 24 hour day for vacation coverage in the Seattle area.
Happily, there are many things that can be done to make eldercare more affordable. Since this is such a large topic, I’m going to break the posts up into several parts, including a section about reducing the senior’s medical and personal expenses. So, check back regularly for updates!
The first thing I did was review our household budget. While tedious the first time to set up, the time spent is a good investment because opportunities for savings are made apparent by looking at the budget. If you have never set up a budget before, Excel has some nice templates that make the process easy and free. I don’t purchase Quicken or similar software and get the same results. Here is a link for an Excel budget which is simple to use.
After reviewing our budget, I determined that the only way to continue our savings goals was to attack spending in every category. Not only were costs such as utilities, food, and gas on the chopping block, other smaller costs were slated for reduction as well. I also decided that we needed to unload any and all extra belongings gathering dust in dark corners.
I also visited our financial adviser. A financial adviser should be able to review your budget with you as well as offer advice on how to reduce debt and increase savings. Hourly rates for financial advisers can cost $150, however there are non-profits which will help for free. This is especially the case if you are trying to get out of debt. Here are a few links:
I also recommend reading Your Money or Your Life, which helped me get out of debt entirely and build my savings. The book is an eye-opening look at the old Money is Time philosophy, along with a plan to assist you in achieving your life’s goals. The authors explain that for every item you purchase, you must work some number of hours to afford them. This leads naturally to asking if the item is really worth your time; if you can live without it or find a cheaper alternative. For example, if you make $25 per hour at your job, and you wish to purchase a dress costing $100, then you must work 4 hours to pay for it. Is that dress really worth working 4 hours at your job when you might have the time off to do something else?
Next post will be about other ways caregivers can improve their situation. I will also write up a post about ways that seniors can reduce their prescription and personal care expenses based on what I have learned thus far. Check back next week!