Caregiving costs Canadians up to $10,000 a year, harming their financial future

Being the caregiver to an older family member is costing Canadians anywhere from $7,000 to $10,000 a year in out-of-pocket spending and harming their own financial future, according to an Edward Jones report.

"Caregiving often requires significant time, emotional energy and financial resources, and most caregivers are managing all three at the same time. The financial impact is real and much of it goes uncovered," said the report released on Wednesday.

Nearly half of the 2,100 Canadians surveyed who are caring for someone 65 or older or with disabilities aged 18 to 64 said they are making personal financial sacrifices to provide care.

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About nine in 10 of those caring for people and their finances said they spent $7,025 of their own per year, which rises to $10,190 when a recipient doesn't have enough money to support themselves, with contributions going to cover household, housing, transportation and medical expenses.

Often, much of that out-of-pocket money goes unrecovered.

A majority of those caregivers are making other financial sacrifices, such as reducing or stopping savings or trimming retirement contributions.

"Some even borrow from or draw on their retirement accounts," the report said, while about a quarter of respondents said they took on debt to help care for someone.

Others forgo income and retirement savings due to fewer career opportunities.

Edward Jones said a huge majority of caregivers wind up assuming the role of financial caregiver to helping to manage finances and legacy affairs, such as wills, as physical or cognitive issues impair people's abilities.

"But financial caregiving is just as much about the caregiver's own finances," the report said.

About half of financial caregivers are also sandwiched between caring for children and usually a parent, three-quarters are employed and the average caregiving tenure lasts seven years, Edward Jones said.

Few people are prepared for what's entailed in financial caregiving since it often starts with an emergency, usually a health problem, but sometimes a financial one.

The reasons someone becomes financial caregiver also have less to do with being in the strongest fiscal position or being qualified and more to do with having the closest relationship with the recipient or being closest in location.

Managing another person's finances might start off with small tasks, but they can become more complicated over time, especially if someone's finances were poorly managed and the caregiver doesn't have a lot of financial experience.

As a result, more than a third rely on professionals for financial and legal help.

Many who look after someone said they don't want to be a burden to their own families, despite generally agreeing that they are willing to sacrifice their own financial security to look after someone they love.

"Unfortunately, reducing their own financial security increases the likelihood that they will need support later in life," Edward Jones said.

Aside from out-of-pocket expenses for things such as specialized medical equipment, medication, transportation and groceries, unpaid caregiving swallows up as much as 5.7 billion hours a year in total, according to a Scotia Wealth Management report last year.

"By spending this time looking after loved ones, they may miss out on opportunities that could improve their own lives," the report said.

The Edward Jones report drew on a survey by Age Wave and the Harris Poll conducted this year.

With files from Yahoo News