The cost of long-term care keeps going up, and it's a growing problem for Americans of all ages

Caregiving expenses have been on the rise in recent years, presenting a significant challenge for Americans of all ages. Tamara Johnson, a 58-year-old executive, moved from New Orleans to Virginia to care for her mother diagnosed with Parkinson's disease and dementia in 2017. She continued working while providing care, but after her mother's death in 2020 and her husband's subsequent catastrophic medical events, Johnson left her job and relied on her savings to pay for her husband's long-term care, estimating the total cost at over $700,000.

Eldercare costs have skyrocketed, outpacing overall consumer prices, food, electricity, and shelter increases over the last three decades. This cost escalation has pushed families to seek lower-quality care, such as lower-rated facilities at half the price of luxury communities. The financial burden is so severe that some families may struggle to pay for their own future care needs.

Despite having long-term care insurance or saving throughout life, many families are forced to use home equity, family contributions, or loans to cover the costs.

The crisis is exacerbated by a shortage of caregivers, caused by a pandemic-induced exodus of workers, stricter immigration policies, and a growing older population. Caregivers are increasingly putting their own money into caregiving resources, with many spending $7,000 annually. Rising caregiver wages are often passed on to families, with nursing and residential care worker wages growing 57% from 2016 to 2026, outpacing overall private wage growth.

Long-term care costs for nursing homes and adult day services have surpassed overall inflation, increasing 212% and 109% since 1997, respectively. As the elderly population continues to grow and surpass the number of children under 18 in the US, the need for long-term care planning becomes increasingly urgent.