Family caregivers who look after adult relatives or friends spend an average of $11,508 annually, which accounts for 31% of their household income, according to a recent study. Family caregiver expenses are particularly burdensome for low-income caregivers with household incomes under $40,000, who must dedicate 76% of their earnings to caregiving costs, creating severe financial strain.
According to the ‘2026 Caregiving Out-of-Pocket Costs Study’ released by the AARP, the largest share of caregiving expenses goes toward housing and living costs. Beyond medical bills, everyday expenses like food, rent, and mortgage payments significantly increase the financial pressure on caregivers.
The survey was conducted in June and July among adults aged 18 and older who provide care for adult family members or friends, with findings published at the end of October. This marks the third time the AARP has surveyed family caregiving costs, following previous studies in 2016 and 2021.
Living and housing costs represented the largest out-of-pocket category, averaging $4,797 per year, or 42% of total caregiving expenditures. Within this category, food and nutritional expenses accounted for 27%, while rent and mortgage payments, including property taxes, made up 25%.
Medical expenses averaged $3,313 annually, comprising 29% of total caregiving costs. Out-of-pocket costs, insurance premiums, and direct payments to hospitals and medical services made up the largest portion at 37%. Nursing home costs accounted for 19%, while prescription drugs, medical devices, supplies, and over-the-counter medications each represented 11%.
The financial pressure of caregiving is drastically heavier for low-income households. Caregivers with incomes below $40,000 spent an average of 76% of their income on care, compared to 17% for those earning between $40,000 and $84,999, and 9% for those making $85,000 to $149,999.
The care recipient’s health status and the intensity of care required also dictate the overall financial scale. Caregivers tending to individuals with Alzheimer’s disease or dementia spent an average of $15,846 per year, which is $5,625 higher than the $10,221 average for those caring for individuals without dementia.
Those providing high-intensity care spent an average of $15,084 annually, whereas low-intensity caregivers spent $8,343. Furthermore, caregivers performing three or more medical or nursing tasks averaged $15,648, nearly double the $7,948 spent by those performing none, demonstrating how advanced medical duties escalate financial hardship.
Caregiver expenses also varied based on the relationship with the recipient and living arrangements. Caregivers looking after adult children averaged $17,775 in annual expenses, spending 50% of their household income. Those caring for young adults aged 18 to 39 faced a 57% income ratio with $16,217 in average expenses.
Co-residing caregivers spent an average of 36% of their household income on care, compared to 26% for those living in separate households. This highlights that parents supporting adult children with illnesses or disabilities face heavy financial burdens alongside those caring for aging parents.
Family caregiving deeply impacts employment and financial stability. Nearly two-thirds of employed caregivers surveyed experienced at least one of six work-related disruptions.
Employed caregivers faced an average out-of-pocket cost of $12,606, with many experiencing higher-than-average financial stress. Those who took on extra jobs to cover costs spent an average of $16,851 (42% of income), while those who borrowed money or took out loans spent $16,580 (50% of income). Caregivers who withdrew from retirement savings spent $17,907 (49% of income), pointing to long-term consequences like increased debt and depleted retirement funds.
To alleviate these burdens, the AARP has proposed policy alternatives including tax credits for family caregivers, affordable in-home care services, expanded respite care support, and guaranteed paid family leave.
