It’s a conversation I find myself having frequently—someone sharing their experiences as a caregiver for a loved one with dementia or Alzheimer’s. These conversations, while unique in their details, share a common theme: the overwhelming stress and uncertainty that comes with this responsibility.

Caring for someone with these diseases is a journey filled with emotional and physical challenges. As I once heard someone say, “If you have seen one person with dementia, you have seen one person only,” emphasizing that each case is distinct, with its own set of hurdles. No two experiences are the same, yet the burden on caregivers is universally heavy.

For many caregivers, balancing their own lives while tending to their loved ones can feel like an impossible task. They often belong to the “sandwich generation,” juggling the care of their children alongside their caregiving responsibilities. As the stress mounts, it’s crucial to remind them that their well-being is just as important as the care they provide.

The Financial and Workplace Strain of Caregiving

The strain of caregiving extends far beyond familial obligations—it also affects careers and financial stability. A staggering 61% of employees are caregivers for aging loved ones, dedicating an average of 20+ hours per week to caregiving responsibilities. Yet, many companies fail to provide adequate support or benefits, exacerbating the stress caregivers face.

The financial impact of caregiving cannot be overstated. In 2021 alone, unpaid care provided to individuals aged 50 or older amounted to $600 billion, reflecting the immense burden placed on family caregivers. Additionally, caregivers often sacrifice their own health, with one in five reporting physical strain and difficulty managing their own well-being due to caregiving demands.

For some, the weight of these responsibilities begins to impact their work performance, leading to job loss or the need to reduce working hours. With rising healthcare costs and the need for professional care services, many families struggle to find a sustainable solution.

A Reverse Mortgage: A Financial Lifeline for Caregivers

As financial advisors, you have the opportunity to introduce an underutilized solution: a reverse mortgage. By unlocking the equity in their home, families can free up much-needed funds to hire professional caregivers, cover the costs of adult daycare, or simply alleviate some of the financial stress that caregiving brings.

A reverse mortgage allows homeowners aged 62+ (55+ in some areas) to access a portion of their home’s value as tax-free income, all while continuing to live in their home without required monthly mortgage payments. This financial tool can provide the flexibility caregivers need to ensure their loved ones receive quality care—without depleting their savings or sacrificing their own financial future.

Helping Clients See the Bigger Picture

Many caregivers don’t realize they have options beyond depleting their retirement accounts or taking on additional debt. As an advisor, guiding them through the benefits of a reverse mortgage can be life-changing. It can mean:

• Hiring professional in-home care so they can continue working without sacrificing their income.
• Paying for adult day programs that provide social engagement and medical supervision.
• Preserving their retirement savings instead of withdrawing funds early and facing unnecessary tax burdens.

Actual Case Study

• Children had Power of Attorney over property and as Co Executors of Family Trust.
• Applied for and was approved for a Jumbo Reverse Mortgage on Mothers Home.
• Loan Approved for $1,100M at 7.5% interest rate.  Took $250,000 cash to pay off mortgage and incidentals at closing, remaining $850,000 available as a 10yr Line of Credit, unused LOC grows at 1.5% annually.
• Initial annual interest cost 7.5% of $250,000 = $18,750.  LOC interest only charged when $$ withdrawn, plan was to set up a monthly withdrawal paid to in-home care company.
• Children will inherit home on step up in basis eliminating capital gains upon sale.
• Accrued interest when paid on sale can be used to cover taxes on decedent estate.

Could This Strategy Benefit Your Clients? Let’s Find Out!

Do any of your clients fit this scenario? Retirement in Reverse would be happy to provide a customized, hypothetical scenario to help you assess if this strategy could be a valuable solution. Let’s explore how we can make it work for your clients!