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The cost of caregiving falls disproportionately on women

Nov 15, 2023 | RBC Wealth Management


When an Alzheimer’s diagnosis is made, women tend to be caregivers for the patients—often resulting in a financial setback for those females.

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Mother working at computer

Even before the COVID-19 pandemic thrust the new demands of e-learning on them, women were disproportionately responsible for unpaid caregiving of loved ones, often prioritizing those responsibilities ahead of their careers.

Research from the Institute for Women’s Policy Research found that in 2019, mothers spent fewer hours on paid work than fathers due to caregiving and household responsibilities, and were more likely to work part-time due to child care problems.

Women are also the primary caregivers for aging parents and spouses who become ill. In fact, nearly two-thirds of dementia caregivers in the United States are female—roughly 10 million women. And, according to the Alzheimer’s Association, dementia-related diagnoses are rising sharply with the number of Americans living with dementia expected to double by 2040.

For many women, the time they devote to caregiving is the equivalent of a full-time job. Often, the demands of caregiving are so intense that they leave the workforce and limit their career opportunities.

“These trade-offs can have long-lasting implications. Over time, women caregivers, even those in high-earning careers, experience a significant, negative impact on their income-generating capacity,” says Ann Senne, head of Advice and Solutions at RBC Wealth Management–U.S. “And, as with childcare, women are the dominant caregivers of loved ones with cognitive decline.”

Inspired in part by the growing number of employees who have family members with Alzheimer’s disease, RBC Wealth Management-U.S. recently commissioned a study of those caring for people affected by cognitive decline. The financial impact of cognitive decline study found what women in the trenches of caregiving already know: it brings more significant trade-offs for women than men in the forms of career disruption and sacrificed personal time.

Female caregivers of people affected by cognitive decline carve out an average of 86 hours per month to accommodate their caregiving responsibilities, compared to 75 hours for men, the study found. One-out-of-eight caregivers—both male and female—spends 160 hours a month or more on these activities. 

The intensity of women’s involvement in caregiving is apparent not just in the hours they dedicate, but also in the specific tasks they undertake. Male caregivers reported focusing on financial support for their affected family members, including paying bills and managing investments—activities more easily absorbed by their existing schedule. Women primarily take charge of home-based, physical-care duties such as helping with bathing and dressing, preparing meals, household chores and driving.

“It’s really the hardest job you’ll ever do,” says Nancy Carlson, whose husband of 38 years suffered from frontotemporal degeneration, a little-known form of dementia that can strike people under age 60. “You have to take care of yourself. It sounds selfish, but it’s not.”

How caregiving changes career trajectory

Lost income is linked to career choices influenced by the physically intensive nature of caregiving. The study found 44 percent of female caregivers adjusted their working patterns—compared with 37 percent of men—to free up more time for caregiving. 16 percent say they took early retirement, nine percent moved from full time to part time and seven percent took an indefinite leave of absence. Even among those who hadn’t formally changed their hours, almost one-third admitted to leaving work early to fulfill their duties.

The precise amount of lost income among female caregivers who adjust their working patterns ranges widely—from $22,000 annually for those who have reduced their working hours, to almost $50,000 when they stop working permanently or temporarily—but on average, they sacrifice approximately $35,000 in annual income due to their caregiving responsibilities. And that does not include personal out-of-pocket costs that they are covering casually.

“A big obstacle for women to continue in the workforce is this balance on the home front,” says Angie O’Leary, head of Wealth Planning at RBC Wealth Management–U.S. “Often women have to take a gap in their career and a lot of that can keep them from reaching parity in the workplace.”

Female caregivers want better financial guidance

Unsurprisingly, the survey found only 47 percent of female caregivers feel very confident about their financial circumstances (compared to 56 percent of male caregivers), but just 38 percent say they find the guidance available to them helpful.

It’s striking that female caregivers point to an absence of helpful resources rather than lack of access to advice. Nearly two-thirds (65 percent) of the women in RBC’s study have participated in financial planning conversations in the past. Despite this, they prefer to turn to family members for financial advice, suggesting they didn’t feel their circumstances were being comprehensively accounted for in their plans.

Senne says RBC Wealth Management’s holistic wealth planning tools are geared toward getting clients to think about how to prepare for future life events, including the possibility of Alzheimer’s or dementia, and how to cover potential long-term health care costs.

“It’s not only capturing what you have from an asset perspective and your liabilities, but really going deep into what your needs are, your wants and your wishes, and what you’re afraid of,” she says. “So we’re working with our advisors to have different kinds of conversations. And when life events happen, being able to be there to support our clients.”

Financial planning that considers cognitive decline

Finances are often the first place that signs of cognitive decline emerge, Senne says.

RBC Wealth Management’s Client Risk Female caregivers of people affected by cognitive decline carve out an average of 86 hours per month to accommodate their caregiving responsibilities, compared to 75 hours for men.Prevention group, launched in 2018, includes a team focused on helping financial advisors detect those issues. They work to protect clients experiencing cognitive decline from financial scams or being taken advantage of by family members, Senne says.

“If our financial advisors see something going on we want them to engage the team to figure out what we can do to help, depending on what the situation is,” says Tara Ambrose, manager of Senior & Vulnerable Client Initiatives at RBC Wealth Management. “That’s been something that is core to our client experience.”

Carlson, who lost her life savings due to a series of poor business decisions her husband made because of his dementia, says families should have tough conversations in good times to plan for the financial effects of a devastating and life-altering illness. Most of the non-medical care costs associated with dementia are not covered by Medicare or traditional health insurance.

“We never talked about that. We didn’t think we’d get sick, we didn’t even imagine it. I think about that a lot now,” Carlson says. “I’m definitely saving my money in case something happens to me, because I don’t want my kids to deal with what I had to deal with.”


Wealth planning