Caregiving costs hit $11,508 yearly average

The average American family caregiver now spends $11,508 per year out of pocket to care for an older relative. A report released this week by AARP found that these costs have risen nearly 60% over the last five years. The organization represents people aged 50 and older.

Debra Whitman, AARP executive vice president and chief public policy officer, said caregivers face a heavy financial commitment. She noted that expenses for groceries, housing, and medical care can threaten their own economic security.

Across the United States, 63 million people provide care for family members. They prepare meals, manage medications, and attend medical appointments. The report states that the number of adults providing this care has grown by 50% in the past decade. This unpaid labor is valued at roughly $1 trillion annually.

The spending burden falls hardest on low-income households. Caregivers with annual incomes under $40,000 spend an average of 76% of their income on caregiving. By contrast, those with incomes above $85,000 spend between 9% and 19% of their earnings. For the average household, caregiving costs eat up 31% of income.

Most of this money goes to housing and medical care. More than one-third of medical spending covers insurance premiums, copays, and direct provider payments. Costs rise for those caring for someone with Alzheimer’s disease or another form of dementia, who spend an average of $15,846 a year.

Work is also affected. Nearly two-thirds of working caregivers reported at least one job disruption, such as changing hours or taking time off. Spending varies by location. Caregivers in New York, New Jersey, and Pennsylvania spend about $15,845 annually. That is nearly double the $7,955 average in states like Iowa, Kansas, Minnesota, and Missouri.

Racial and ethnic groups report different spending levels. Asian American and Pacific Islander caregivers spend the most at $16,716. Black caregivers spend $13,565, which is 52% of their household income, the highest percentage of any group. Hispanic and Latino caregivers average $10,684, while white caregivers report the lowest average at $9,806.