'We Thought Within a Year, She Would Be Gone.' When Mom's Care Costs Over $1 Million.

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The Carson family spent more than $1.3 million taking care of Violet at her home over the last decade. Fortunately, she and her husband had saved, and the family could cover the cost of round-the-clock in-home care without going into debt. Many people aren’t as well positioned.

The median net worth of people 75 and older is $254,800, according to the Federal Reserve, which is about the same amount that it would take to cover an estimated cost of nearly 14 months of 24/7 in-home care. Caregiving is becoming more expensive as people are living longer—those 85 to 99 are among the fastest-growing age segments—and have more complicated medical needs.

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To help prepare, families are advised by personal finance advisers to implement the widely used 40/70 rule: By the time an adult child is 40 and the parents are 70, they should talk about a parent’s financial situation, insurance and long-term care wishes. Paying for in-home care is one challenge, but finding reliable and consistent in-home care in an industry with roughly 65% turnover is another.

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One way the Carsons avoided the turnover was by paying higher wages. Payroll was the Carson family’s biggest expense, averaging more than $130,000 annually in the last five years of Violet’s life and peaking at $148,000 in 2020 with overtime costs related to the pandemic, according to family records. There were other costs, totaling more than $50,000, and not covered by Medicare, including a special handicapped-accessible van that cost about $40,000 and $20,000 for a special tub. “It was worth every penny,” says son Steve Carson, 68, who lives in Salisbury, N.C.

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