Family caregivers in the United States now spend an average of $11,508 out of pocket annually, according to a study released by AARP. This figure represents a roughly 60% increase over the past five years, outpacing the overall inflation rate of 24% measured during the same period by the federal Bureau of Labor Statistics’ Consumer Price Index.
Rising Expenses and Mounting Responsibilities
The study, which surveyed 2,538 family caregivers, reveals that these out-of-pocket costs consume about 31% of a caregiver’s income on average. Basic expenses such as food, housing, and medical bills constitute the largest portion of these financial burdens. Megan O’Reilly, vice president of governmental affairs at AARP, explains that the cost escalation coincides with families taking on heavier care and more complex medical duties at home. In addition to direct spending, many caregivers are forced to reduce their working hours or leave their jobs entirely, leading to a combination of higher expenses and lost income.
Approximately 63 million Americans—roughly one in four adults—currently provide ongoing support to an aging friend or family member. This demand is projected to expand as an estimated 70% of individuals turning 65 today will require assistance as they age. Because Medicare does not cover routine home care or facility-based long-term care, expenses remain high. Genworth data shows that 40 hours of weekly in-home care averaged $72,792 per year in 2025, while skilled nursing for a shared room averaged $115,000 annually.
Legislative Proposals and Potential Support
Public assistance programs offer limited relief. While state Medicaid programs pay certain family caregivers—such as in California, where over 800,000 caregivers earn between $16.90 and $25 per hour—funding faces potential cuts under federal budget legislation. Veterans Administration benefits can also cover care costs for eligible individuals, though the application process often requires hiring legal advocates to navigate complex rules.
AARP executive vice president Nancy LeaMond notes that the growing financial strain on millions of families may drive legislative action. Lawmakers have introduced several proposals to aid caregivers, including allowing tax-sheltered health savings accounts to cover parents’ medical expenses and establishing a bipartisan federal bill for a $5,000 nationwide caregiver tax credit. Currently, six states offer tax credits ranging from $1,000 to $5,000 for expenses like home retrofitting, while two others maintain limited programs. Additional federal proposals aim to establish a national paid family and medical leave policy offering up to 12 weeks of partly paid leave, and to protect the Social Security benefits of individuals who leave the workforce to care for relatives full-time.
