Family caregivers face money setbacks and more: Edward Jones

As millions of Americans take on caregiving duties for loved ones, a new study from Edward Jones, in partnership with Morning Consult and Age Wave, reveals the long-lasting financial and emotional toll of caregiving – and underscores the growing need for advisors to step in with support.

According to the study, two in five US adults identify as family caregivers today, and 46 percent expect to take on that role in the future. Among current caregivers, 95 percent expressed concern about their retirement outlook, with more than half saying they’ve reduced personal spending to keep up with caregiving demands.

Top concerns include rising costs and inflation, cited by 56 percent of respondents, and inadequate retirement savings, named by 42 percent.

That echoes previous survey research by Nationwide, which found 43 percent of respondents feared expenses from caregiving would prevent them from ever retiring. Another study by Voya Financial suggests minorities are harder hit, with 28 percent of Asian, Hispanic, and Black Americans reporting a severe or major impact on their retirement savings compared to 19 percent of White Americans.

Some caregivers are also making significant career sacrifices: one in four respondents surveyed by Edward Jones have left their jobs, 24 percent have cut back on hours, and nearly one in five have tapped into their own retirement savings.

“Caregivers have an essential role in our society, yet our research found that they often bear great financial burdens and sacrifice their own well-being to care for their children and their elder family members without adequate support,” said Ken Dychtwald, founder and chief executive of Age Wave. “As family caregivers are a crucial part of our care systems, their vital role in society demands greater recognition, resources and relief.”

A recent survey by Hearts & Wallets showed that among households with at least $3 million in investable assets, those aged 21 to 50 bore the heaviest burden from financial caregiving, fulfilling at least three of the nine financial caregiving responsibilities that Hearts & Wallets tracks. 

While 83 percent of caregivers in the Edward Jones study report high levels of stress and 77 percent say they feel burned out, the role still offers emotional rewards. Most caregivers say it has brought them closer to loved ones, with 83 percent reporting personal fulfillment and 84 percent saying they feel appreciated.

Despite the challenges, only 43 percent of caregivers have sought professional financial guidance. However, among those who work with a financial advisor, 93 percent feel more confident about their financial future – an opening for RIAs to address caregiving-specific financial vulnerabilities.

“By fostering strong community ties and taking a holistic approach, financial advisors can get a more complete picture and serve their clients more deeply,” said Ken Cella, principal and head of external affairs at Edward Jones. “This enables caregivers to navigate the complex realities of care while planning for long-term multiple financial and life goals.”

In addition to sharing new research, Edward Jones voiced support for two pieces of bipartisan legislation aimed at bolstering caregivers’ retirement security.

The Improving Retirement Security for Family Caregivers Act would allow qualified family caregivers to contribute to a Roth IRA, even with little or no earned income. Eligible individuals – those providing at least 500 hours of unpaid care annually and with limited paid employment – could contribute up to $7,000 annually, or $8,000 if one is age 50 or older.

Meanwhile, the Catching Up Family Caregivers Act proposes allowing the same group to make catch-up contributions to employer-sponsored retirement plans for up to five years, reflecting the time they spent out of the workforce due to caregiving responsibilities.

The bipartisan, bicameral bills – sponsored by Senators Susan Collins and Mark Warner in the Senate, and Congresswomen Maria Elvira Salazar and Brittany Petersen in the House of Representatives – aim to recognize the economic trade-offs unpaid caregivers face and help them recover lost ground in their long-term financial planning.

Edward Jones' study also found that 74 percent of Americans believe employers should offer flexible benefits for workers with caregiving duties, and 73 percent support expanding caregiver retirement contributions – suggesting growing public appetite for structural policy change.