Caring for aging parents costs Canadians $33 billion a year in direct out-of-pocket expenses and time off work, according to a new report by CIBC Capital Markets released May 8.
The report, Who Cares: The Economics of Caring For Aging Parents, co-authored by CIBC Deputy Chief Economist Benjamin Tal and Senior Economist Royce Mendes, forecasts that direct and indirect costs associated with the elderly will grow by more than 20 per cent in real dollars over the next 10 years due solely to changing demographics.
Longer life spans and strained social services
"An aging population combined with longer life spans and strained social services has in recent years seen more and more Canadians taking on the role of caregiver for their aging parents, and in the coming years, that tendency is only likely to intensify," says Tal.
Today, close to two million Canadians, or 14 per cent of those with parents over the age of 65, pay for care-related, out-of-pocket costs, the report says. Those in the eastern and western provinces face the highest direct costs, compared to those in Ontario and Quebec.
$3,300 a year per caregiver on average
"On average that cost is $3,300 a year per caregiver, translating into an annual cost of just over $6 billion to the overall economy," says Tal. He underlined that research in the U.S. suggests survey respondents usually underestimate how much they spend on caregiving-related expenses.
Many of these direct costs are borne by those with lower incomes. Canadians earning less than $50,000 per year spend on average 30 per cent more than higher-earning Canadians, implying a much greater cost relative to incomes, the report says.
"Close to 30 per cent of workers with parents over the age of 65 lose roughly 450 hours per year of time off work to attend to the care needs of aging parents, with the largest impact falling to women and lower income earning Canadians." This translates into roughly $27 billion of lost income or foregone vacation time, he adds.
To ensure that you are not a burden on your family as you age, talk to a Four Points Financial Solutions advisor by calling 1.866.235.0004 today.