Retirement Security: Some Parental and Spousal Caregivers Face Financial Risks

According to the U.S. Census Bureau, the number of people in the United States over age 65 is expected to almost double by 2050. As Americans age, family caregivers, such as adult children and spouses, play a critical role in supporting the needs of this population. However, those who provide eldercare may risk their own long-term financial security if they reduce their workforce participation or pay for caregiving expenses. GAO was asked to provide information about parental and spousal caregivers and how caregiving might affect their retirement security.

This report (1) examines what is known about the size and characteristics of the parental and spousal caregiving population, including differences among women and men; (2) examines the extent to which parental or spousal caregiving affects retirement security; and (3) identifies and discusses policy options and initiatives that could improve caregivers' retirement security.

GAO analyzed data from three nationally representative surveys; conducted an extensive literature review; and interviewed experts who are knowledgeable about caregiving or retirement security, engaged in research or advocacy around caregiving, or represent groups that might be affected by the identified policy approaches.

An estimated one in 10 Americans per year cared for a parent or spouse for some period of time from 2011 through 2017, and women were more likely than men to provide care, according to Bureau of Labor Statistics survey data. Both parental and spousal caregivers were older than the general population, with spousal caregivers generally being the oldest. In addition, spousal caregivers were less likely to have completed college or to be employed, and they had lower earnings than parental caregivers and the general population. Most parental and spousal caregivers provided care for several years, and certain groups were more likely to provide daily care, including women and minorities.

Some caregivers experienced adverse effects on their jobs and had less in retirement assets and income.

According to data from a 2015 caregiving-specific study, an estimated 68 percent of working parental and spousal caregivers experienced job impacts, such as going to work late, leaving early, or taking time off during the day to provide care. Spousal caregivers were more likely to experience job impacts than parental caregivers (81 percent compared to 65 percent, respectively).

According to 2002 to 2014 data from the Health and Retirement Study, spousal caregivers ages 59 to 66 had lower levels of retirement assets and less income than married non-caregivers of the same ages. Specifically, spousal caregivers had an estimated 50 percent less in individual retirement account (IRA) assets, 39 percent less in non-IRA assets, and 11 percent less in Social Security income. However, caregiving may not be the cause of these results as there are challenges to isolating the effect of caregiving from other factors that could affect retirement assets and income.

Expert interviews and a review of relevant literature identified a number of actions that could improve caregivers' retirement security, which GAO grouped into four policy categories. Experts identified various benefits to caregivers and others from the policy categories—as well as pointing out possible significant costs, such as fiscal concerns and employer challenges—and in general said that taking actions across categories would help address caregivers' needs over both the short-term and long-term (see figure). Several experts also said public awareness initiatives are critical to helping people understand the implications of caregiving on their retirement security. For example, they pointed to the need for education about how decisions to provide care, leave the workforce, or reduce hours could affect long-term financial security.

The number of people in the United States over age 65 is projected to  almost double in size by 2050, comprising 1 of every 5 people. Of the  population who were over age 65 in 2016, more than 40 percent (20.6  million) were over age 75. As Americans age, family caregivers, such as  adult children and spouses, will play a critical role in supporting the needs  of this population. However, those who provide eldercare may face risks  to their own long-term financial security. For example, caregivers may  take time out of the workforce or reduce their work hours to provide care,  or they may stop saving for their own retirement or tap into their  retirement savings to pay for out-of-pocket caregiving expenses, such as  travel or medical expenses. These caregivers may ultimately receive less  in Social Security benefits if they reduce their workforce participation.  While men caregivers may face some of these risks, the effects of  caregiving for women are compounded by lower average lifetime  earnings and a longer life expectancy than men. As a result, women  caregivers are at an increased risk of outliving their savings.

You asked that we provide information about parental and spousal  caregivers and to identify options that could improve their retirement  security. This report (1) examines what is known about the size and  characteristics of the parental and spousal caregiving population,  including differences among women and men; (2) examines the extent to  which parental or spousal caregiving affects retirement security; and (3)  identifies and discusses policy options and initiatives that could improve  caregivers’ retirement security.

To determine the characteristics of parental and spousal caregivers, we  analyzed nationally representative survey data from the American Time  Use Survey (ATUS) eldercare module for 2011 through 2017, the most  recent available. The ATUS eldercare module measures the amount of  time people spend doing various activities related to eldercare. The  survey asks respondents whether they provided unpaid care or  assistance more than once in the 3 to 4 months prior to the survey to a  person who needed help because of a condition related to aging.

To estimate the effect of parental and spousal caregiving on caregivers’  jobs, we analyzed nationally representative survey data that was used in  the 2015 Caregiving in the U.S. study. The survey asks respondents  whether they provided unpaid care to a relative or friend 18 years or older  to help them take care of themselves, and asks whether working  caregivers experienced specific job impacts due to caregiving.

To estimate the effect of caregiving on retirement security, we analyzed  nationally representative survey data from the Health and Retirement  Study (HRS) from 2002 through 2014. HRS is a longitudinal survey of  individuals over 50 that is conducted every 2 years. The initial cohort of  respondents was ages 51 to 61 in 1992, and these respondents have  been interviewed every 2 years since 1992. HRS has replenished the  sample of younger cohorts every 6 years since 1992; however, there are  some years of data that do not include younger respondents. Unlike the  surveys above, which use a single definition for all types of caregivers,  the definitions for parental and spousal caregivers in the HRS were  different. To identify parental caregivers, the HRS survey asks  respondents whether they spent 100 hours or more since their last  interview or in the last 2 years helping a parent or parent-in-law with basic  personal activities such as dressing, eating, or bathing, or with household  chores, errands, or transportation, among other tasks. To identify spousal  caregivers, we used the questions that ask respondents whether they  received help with activities of daily living (ADLs) or with instrumental  activities of daily living (IADLs). We determined whether parental or  spousal caregivers provided care in the 6 years leading up to ages 65 or  66 to capture the possible effect of caregiving on retirement income and  assets. To obtain information on caregivers in this time period, we started  with individuals initially interviewed at age 61 who would have provided  care starting at 59, given the biennial nature of the survey. Each cohort of  data includes individuals initially interviewed at age 61, which allowed us  to maximize the number of individuals we could include in the HRS  sample. However, as a result of this decision, our analysis did not cover  caregiving that took place prior to age 59. Specifically, using HRS data,  we examined differences between caregivers’ and non-caregivers’  individual retirement account (IRA) assets, non-IRA assets, defined  contribution account (e.g., 401(k)) balances, and Social Security income.  We also conducted regression analyses to examine whether observed  differences were statistically significant when we controlled for  demographic and other characteristics of parental and spousal  caregivers.

For all of the survey data used in our study, we reviewed documentation,  interviewed or obtained information from officials responsible for the data,  and tested the data for anomalies. We determined the data were  sufficiently reliable for the purposes of this report.

To identify policy options and initiatives that could improve caregivers’  retirement security, we conducted an extensive literature review of journal  articles, working papers, and think-tank studies on caregiving and topics  related to retirement security, and conducted interviews with experts in  caregiving or retirement security. Based on this information, we identified  specific actions that could affect caregivers’ retirement security, which we  grouped into four different policy categories based on common themes.  We then conducted semi-structured interviews with a range of experts  and stakeholders—including some of the experts we met with to identify  specific policy actions—to obtain their views on the benefits and costs of  the specific policy options and approaches we identified. We selected  experts and stakeholders who are knowledgeable about caregiving or  retirement security or both, who are engaged in research or advocacy  around caregiving, or who represented groups that might be affected by  the identified policy approaches. See appendix I for more detailed  information about our scope and methodology.

We conducted this performance audit from November 2017 to May 2019  in accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.

There are three main pillars of retirement income in the United States:  Social Security benefits, employer-sponsored or other retirement savings  plans, and individual savings and assets.

Social Security is a cash benefit that partially replaces earnings when an  individual retires or becomes disabled. The monthly benefit amount  depends on a worker’s earnings history and the age at which he or she  chooses to begin receiving benefits, as well as other factors. Social  Security benefits are paid to workers who meet requirements for the time  they have worked in covered employment, that is, jobs through which  they have paid Social Security taxes. To qualify for retirement benefits,  workers must typically have earned a minimum of 40 quarters of  coverage (also referred to as credits) over their lifetime. Social Security  benefits are calculated based on the highest 35 years of earnings on  which workers paid Social Security taxes. Those who wait until the full  retirement age, which has gradually increased from 65 to 67, to claim  Social Security receive unreduced benefits. Social Security provides  larger benefits, as a percentage of earnings, to lower earners than to  higher earners.

Social Security makes up a large portion of income for many older  Americans, and older Americans face greater risk of poverty without  Social Security benefits. We previously reported that data from the Federal Reserve Board’s most recent Survey of Consumer Finances  showed that in 2016, among households age 65 and over, the bottom 20  percent, ranked by income, relied on Social Security retirement benefits  for 81 percent of their income, on average. According to a 2014 Census  report, about 43 percent of people age 65 or older would have incomes  below the poverty line if they did not receive Social Security.

Employer-Sponsored or Other Retirement Savings Plans

The most common type of employer-sponsored retirement plan is a  defined contribution plan, such as a 401(k) plan. Defined contribution  plans generally allow individuals to accumulate tax-advantaged retirement  savings in an individual account based on employee and employer  contributions, and the investment returns (gains and losses) earned on  the account. Individuals or employers may make contributions up to  statutory limits. Individuals typically pay fees for account maintenance,  such as investment management or record keeping fees. An employee  may take funds out of the account prior to age 59 ½, but will owe taxes,  possibly including an additional tax, for early withdrawal.

Workers can also save for retirement through an individual retirement  account (IRA). IRAs allow workers to receive favorable tax treatment for  making contributions to an account up to certain statutory limits. Most  IRAs are funded by assets rolled over from defined benefit and defined  contribution plans when individuals change jobs or retire. Individuals must  have taxable earnings to contribute to an IRA, and the amount of their  contribution cannot exceed their earned income. IRAs also have  account maintenance fees, which are generally higher than those  charged to participants in employer-sponsored plans. IRAs are a major  source of retirement assets. As we reported in 2017, IRAs held about  $7.3 trillion in assets compared to $5.3 trillion held in defined contribution  plans.

Individuals may augment their retirement income from Social Security and  employer-sponsored plans with their own savings, which includes any  home equity and other non-retirement savings and investments. Non- retirement savings and investments might include income from interest,  dividends, estates or trusts, or royalties.

Selected Federal and State Efforts to Support Caregivers

Through our review of literature and interviews with experts, we identified  several federal and state efforts that may provide support to caregivers:

Medicaid. This federal-state health financing program for low-income  and medically needy individuals is the nation’s primary payer of long- term services and supports for disabled and aged individuals. Within  broad federal requirements, states have significant flexibility to design  and implement their programs based on their unique needs, resulting  in 56 distinct state Medicaid programs. Under Medicaid requirements  governing the provision of services, states generally must provide  institutional care to Medicaid beneficiaries, while home and  community based long-term services and supports is generally an  optional service. All 50 states and the District of Columbia provide  long-term care services to some Medicaid beneficiaries in home and  community settings under a variety of programs authorized by statute.  Some of these programs include self-directed services under which  participants, or their representatives if applicable, have decision- making authority over certain services and take direct responsibility  for managing their services with the assistance of a system of  available supports. Under one such program, participants can hire  certain relatives to provide personal care services.

Tax-related provisions. Caregivers may be able to use dependent  care accounts, tax credits, or tax deductions for financial assistance  with caregiving costs. Dependent care accounts are set up through an  employer and allow individuals to set aside pre-tax funds to care for a  qualifying individual, such as a spouse who is unable to care for  himself or herself. As an example of a tax credit, beginning in 2018,  caregivers may be eligible to obtain a $500 non-refundable credit for  qualifying dependents other than children, such as a parent or a  spouse. As an example of a deduction, taxpayers may deduct the cost  of qualifying medical expenses.

The Family and Medical Leave Act of 1993 (FMLA). This act  generally provides up to 12 weeks of unpaid leave per year for eligible  employees to help care for a spouse, child, or parent with a serious  health condition or for their own serious health condition, among other  things. Employees are generally eligible for FMLA leave if they have  worked for their employer at least 12 months, at least 1,250 hours  over the past 12 months, and work at a worksite where the employer  employs 50 or more employees or if the employer employs 50 or more  employees within 75 miles of the worksite.

The Older Americans Act of 1965. This act was passed to help older  individuals remain in their homes and includes grant funding for  services for older individuals. Since its reauthorization in 2000, the  Older Americans Act of 1965 has provided supports for caregivers  through programs such as the National Family Caregiver Support  Program. This program provides grants to states to fund a range of  supports to help caregivers. For example, the program provides  access to respite care. According to the National Institute on Aging,  respite care provides in-home or facility-based care by a trained care  provider to give the primary caregiver short-term relief from  caregiving.

Paid sick leave. This form of leave provides pay protection to  workers for short-term health needs, and paid family leave is used by  employees for longer-term caregiving. No federal sick or paid family  leave policy exists. However, as of March 2019, 10 states (AZ, CA,  CT, MA, MD, NJ, OR, RI, VT, WA) and the District of Columbia (DC)  have guaranteed paid sick days for specific workers, according to the  National Partnership for Women and Families, with eligibility varying  by state. As of February 2019, six states (CA, NJ, NY, RI, MA, and  WA) and DC have paid family leave laws in effect or soon will be  implementing them, according to the National Partnership for Women  and Families. The covered family relationships, wage replacement  rate, and funding mechanism of these programs vary by state.

About One in 10 Americans Provided Parental or Spousal Care, with Women and Minority Caregivers Providing More Frequent Care

Most Eldercare Providers Cared for a Parent or Spouse

An estimated 45 million people per year provided unpaid eldercare from  2011 through 2017, according to American Time Use Survey (ATUS)  data. About 26 million people—roughly one in 10 adults in the U.S.  population—cared for their parent or spouse, and about 22 million people  cared for other relatives, such as grandparents, aunts and uncles, or non- related adults (see fig. 1). Among parental and spousal caregivers, 88  percent (about 23.4 million people) provided care to a parent, and 12  percent (3.2 million people) provided care to a spouse. About 7.4 million  parental or spousal caregivers (close to 30 percent) provided care for  more than one person.

Parental and Spousal Caregivers Had Similar Demographic Characteristics but Different Economic Circumstances

We examined several demographic and economic characteristics of  parental and spousal caregivers compared to the general population.

Women and men were almost evenly divided in the general population,  but women were more likely than men to be parental or spousal  caregivers, according to ATUS data from 2011 through 2017. Women  made up 52 percent of the general population, but represented 56  percent of parental caregivers and 63 percent of spousal caregivers (see  fig. 2).

Parental caregivers were younger than spousal caregivers, but both  groups were older, on average, than the general population. The average  age of parental caregivers was 50, and the average age of spousal  caregivers was 70, according to ATUS data. While about half of the  general population was under 45, most parental caregivers were over 50,  and most spousal caregivers were over 65 (see fig. 3). While far fewer in  number, spousal caregivers were considerably older than parental  caregivers. Almost three-quarters of spousal caregivers were over Social  Security claiming age for full retirement benefits compared to less than 10  percent of parental caregivers.

The racial/ethnic distribution of parental and spousal caregivers was  consistent with the general population in that a significant majority of  caregivers were white. When compared to the general population,  caregivers were more likely to be white and less likely to be minorities.

The distribution in the marital status of parental caregivers was similar to  the general population in that most people in the general population were  married, followed by single, divorced, widowed, and separated. About  two-thirds of parental caregivers were married, and not surprisingly,  almost all spousal caregivers were married.

Parental caregivers were more educated than spousal caregivers and the  general population, according to ATUS data. For example, 38 percent of  parental caregivers had completed college compared to 26 percent of  spousal caregivers (see fig. 4). These differences may reflect that spousal  caregivers are generally older and may come from a generation in which  women were less likely to attend college.

Parental caregivers were more likely to be employed and to have higher  earnings than spousal caregivers and those in the general population.  Over 70 percent of parental caregivers worked either full-time or part-time  compared to 26 percent of spousal caregivers and 62 percent of the  general population (see fig. 5). This may be related to the older age of  many spousal caregivers, as the percentage of spousal caregivers out of  the labor force was about equal to the percentage over age 65. Further,  parental caregivers tended to earn higher wages than spousal caregivers.  Among wage and salary workers with a single job, parental caregivers  earned $931 per week while spousal caregivers earned $513 per week,  and the general population earned $743 per week, according to ATUS  data.

Women Caregivers Were More Likely to Work Part- time and Have Lower Earnings than Men Caregivers

We found that women who provided parental or spousal care were more  likely to be employed part-time and to have lower earnings than men who  were parental or spousal caregivers (see fig. 6). Women caregivers  were less likely to work than men caregivers, but among those who  worked, women caregivers were more likely to work part-time, according  to ATUS data. For example, among parental caregivers, 66 percent of  women were employed either full-time or part-time compared to 77  percent of men, but 17 percent of women worked part-time compared to  10 percent of men. Similarly, among spousal caregivers, women were  less likely to be employed than men. In addition, differences in the  employment status of women and men caregivers are similar to  differences between women and men in the general population. When we  examined the distribution of men and women caregivers in earnings  quartiles, we found that men caregivers were more likely to be among the  highest earners. For parental caregivers, 43 percent of men compared  to 25 percent of women were among the highest earners. For spousal  caregivers, 22 percent of men compared to 14 percent of women were  among the highest earners. Regression results show that these  differences between men and women caregivers were significant for  parental and spousal caregivers, and remained significant after controlling  for caregiver age and years of education.

In terms of education, women parental caregivers were more likely to  have completed some college or more (69 percent) while women spousal  caregivers were less likely to have done so (50 percent) compared to  men parental and spousal caregivers (63 and 56 percent, respectively).  Similar to the education levels of the parental and spousal caregiving  populations generally, these results may reflect generational differences.

Women, Minorities, and Those with Lower Education and Earnings Levels Provided More Frequent Care

Spousal caregivers were more likely to provide care daily compared to  parental caregivers, and parental caregivers who lived in the same house  as their parents were unsurprisingly more likely to provide care daily than  those who did not, according to ATUS data. The vast majority of spousal  caregivers (81 percent) provided care on a daily basis compared to 21  percent of parental caregivers. When we examined the frequency of  caregiving among those who lived in the same house as their parents, we  found that about 63 percent of these parental caregivers provided care  daily, suggesting there is a positive relationship between frequency of  care and cohabitation (see fig. 7). Experts we spoke with said the  frequency of care may depend on whether the care recipient has a  disability and the type of disability. For example, someone with a severe  disability may be more likely to require care daily compared to someone  with a less severe disability.

Women and minorities tended to provide care more frequently. Among  parental and spousal caregivers, 30 percent of women provided care  daily compared to 25 percent of men. While the majority of caregivers  were white, as discussed above, black and Hispanic caregivers were  more likely to provide daily care than white caregivers—35 percent of  black caregivers and 39 percent of Hispanic caregivers provided care  daily compared to 26 percent of white caregivers (see fig. 8). While most  parental caregivers were married, parental caregivers who were never  married were more likely to provide daily care than divorced, widowed,  separated, and married caregivers.

Daily caregiving may be concentrated among those with the fewest  financial resources. Parental or spousal caregivers with lower levels of  education and earnings were more likely to provide care daily (see fig. 9).  For example, 48 percent of caregivers without a high school degree  provided care daily compared to 21 percent who had completed college.  Those who worked part-time were also more likely to provide care daily  compared to those who worked full-time (27 percent versus 18 percent,  respectively). Those who provided care daily were also more likely to be  among the lowest earners.

In addition to examining frequency of care, we also found that most  parental or spousal caregivers provided care that lasted several years.  The majority of parental or spousal caregivers (54 percent) provided care  for at least 3 years, and 16 percent provided care for 10 years or more.  On average, parental or spousal caregivers provided care for about 5  years, regardless of gender. The number of years of care provided  increased with the age of the parental or spousal caregivers (see fig. 10).

Women caregivers, spousal caregivers, and Hispanic caregivers were  more likely to provide long-term daily care. Among parental or spousal  caregivers who said they provided care daily and provided care for at  least 5 years, 61 percent were women. In comparison, among all parental  and spousal caregivers, 56 percent were women. Twenty-nine percent of  spousal caregivers provided long-term daily care compared to 8 percent  of parental caregivers. In addition, 16 percent of Hispanic caregivers  provided long-term daily care compared to 10 percent of whites and 12  percent of blacks.

Some Caregivers Experienced Adverse Effects on Their Jobs and on Their Retirement Assets and Income

Parental and Spousal Caregivers Said Caregiving Affected Their Work

An estimated 68 percent of working parental and spousal caregivers said  they experienced at least one of eight job impacts about which they were  asked, according to our analysis of data used in the 2015 National  Alliance for Caregiving and AARP sponsored study, Caregiving in the  U.S. The highest percentage of parental and spousal caregivers—more  than half—reported that they went in late, left early, or took time off during  the day to provide care (see fig. 11).

Spousal caregivers were more likely to experience adverse job impacts  than parental caregivers. About 81 percent of spousal caregivers said  they experienced at least one of the eight job impacts they were asked  about compared to 65 percent of parental caregivers. Spousal caregivers  were more likely to reduce their work hours, give up work entirely, or  retire early, compared to working parental caregivers. For example, 29  percent of spousal caregivers said they went from working full-time to  part-time or cut back their hours due to caregiving, compared to 15  percent of parental caregivers. Our prior work has reported that some  older workers felt forced to retire for professional or personal reasons and  that individuals approaching retirement often have to retire for reasons  they did not anticipate, including caregiving responsibilities. In addition,  our prior work has reported that job loss for older workers, in general, can  lead to lower retirement income, claiming Social Security early, and  exhaustion of retirement savings. We also found that older workers face  many challenges in regaining employment.

Consistent with these results, we also found that spousal caregiving was  negatively associated with the number of hours caregivers worked.  Specifically, spousal caregivers who were ages 59 to 66 worked  approximately 20 percent fewer annual hours than married individuals of  the same age who did not provide spousal care, according to HRS data  from 2002 to 2014.

Spousal Caregivers Nearing Retirement Had Less in Retirement Assets and Income While Parental Caregivers Did Not

We found that spousal caregivers who were at or near the age of full  retirement eligibility had lower levels of IRA assets, non-IRA assets, and  Social Security income compared to those who did not provide care. We  did not detect the same relationship between parental caregiving and  retirement income, which may be due, in part, to the older age of the  caregivers we examined.

Retirement Assets and Income of Spousal Caregivers

Spousal caregivers at or near retirement age had lower levels of  retirement assets and income compared to married individuals who did  not provide spousal care. Spousal caregivers tended to have lower  levels of IRA assets, non-IRA assets—such as real estate or stocks—and  Social Security income than non-caregivers (see table 1). After  controlling for certain characteristics of caregivers, we found that spousal  caregivers still had less retirement assets and income than non- caregivers. For example, spousal caregivers had an estimated 39 percent  less in non-IRA assets than non-caregivers, after controlling for  characteristics such as level of education and race/ethnicity.

When we compared women and men spousal caregivers, we found both  had less in IRA and non-IRA assets than non-caregivers, but only women  had less in Social Security income. Specifically, we found that women  and men caregivers had 37 to 54 percent less in IRA and non-IRA assets  than non-caregivers, after controlling for demographic and other  characteristics. However, the effect of spousal caregiving on Social  Security income was only significant among women. Women caregivers  had 15 percent less in Social Security income than married women who  did not provide care. Many older Americans rely on Social Security for a  significant portion of their retirement income. Therefore, a lower Social  Security benefit could have serious consequences for these individuals’  retirement security.

One possible explanation experts offered for why spousal caregivers may  have less in retirement income and assets than non-caregivers is that the  care recipient may be in poor health, resulting in reduced workforce  participation of both members of the household, which could then have a  large negative impact on household wealth. This scenario could leave  spousal caregivers in a precarious financial situation heading into  retirement.

Retirement Assets and Income of Parental Caregivers

We did not find that parental caregivers at or near retirement age had  lower levels of retirement assets or income than non-caregivers. We  compared the retirement assets and income of parental caregivers to the  retirement assets and income of individuals who did not provide parental  care and did not find a statistically significant effect of parental caregiving  on IRA assets, non-IRA assets, defined contribution balances, or Social  Security income. See appendix I for more information on this analysis.

We may not have seen a significant effect of parental caregiving for a few  reasons. First, because of the scope of the HRS data we used, we limited  the analysis to individuals who provided care in the 6 years leading up to  ages 65 or 66. Therefore, this analysis does not capture the possible  effects of parental caregiving prior to age 59, which may be during the  middle of a person’s career or during their peak earning years. Second,  similar to spousal caregivers, experts said a caregiver may reduce their  workforce participation to care for a parent; however, parental caregiving  may not affect household income because married caregivers’ spouses  may be able to continue working and offset any lost earnings. In addition,  unlike spousal care, parental care may be provided by multiple  individuals, so the effect on retirement security may be distributed across  siblings.

Challenges in Comparing Caregivers to Non-caregivers

Our analysis could not definitively identify the causal effect or lack of  effect of caregiving on retirement income due to three main limitations.  First, because caregiving is not random but is a function of an individual’s  circumstances, it is difficult to isolate its effect. For example, individuals  who provide care may do so because they have jobs that are more  flexible, or because they have better family support. Second, there may  be other ways of providing care beyond an individual giving their time that  were not captured in the HRS data and therefore could not be included in  our analysis. For example, a child may provide financial assistance to a  parent rather than providing time. However, the HRS does not capture  whether financial help to parents was specifically used for caregiving  expenses. Third, common to analyses of this type, alternate measures of  certain variables may produce different estimates. For example, we  controlled for a caregiver’s level of education based on data included in  the HRS; however, a measure of education that included the type of  education, such as whether the person was a trained caregiver, might  have changed our estimates. As a result of these limitations, our  estimates may not capture the effect of caregiving on retirement income  for the broader population.

Experts Said a Comprehensive Framework That Incorporates Actions across Policy Categories Could Improve Caregivers’ Retirement Security

Caregivers Face Several Retirement Security Challenges

Our analysis of literature and expert interviews found that parental or  spousal caregivers could face several retirement security challenges:

Caregivers may have high out–of-pocket expenses. Caregivers  may face immediate out-of-pocket expenses that could make it  difficult to set aside money for retirement or that could require them to  prematurely withdraw funds from existing retirement accounts. These  financial burdens can include, for example, travel and medical  expenses for a care recipient. AARP’s study, Family Caregiving and  Out-of-Pocket Costs, estimated that family caregivers spent an  average of nearly $7,000 on caregiving costs in 2016. Caregiving  costs amounted to about 14 percent of income for white family  caregivers and 44 percent and 34 percent for Hispanic and black  caregivers, respectively.

Caregivers may reduce their workforce participation. In addition to  foregone earnings, caregivers who reduce their workforce  participation may also lose access to employer-provided retirement  benefits, such as participating in an employer-sponsored 401(k) plan  or receiving an employer’s matching contributions. About 68 percent  of working parental and spousal caregivers reported job impacts due  to caregiving responsibilities, which included reducing their workforce  participation. For those who leave the workforce, re-entry can be  challenging, and wages and retirement savings can be negatively  affected long-term.

Caregivers may not contribute to retirement accounts. Caregivers  may face challenges contributing to retirement accounts due to  caregiving, and some working caregivers may not be eligible for  employer-sponsored retirement benefits. For example, some part-time  employees may not be eligible to participate in employer-sponsored  retirement plans, or some employees may lose access if they reduce  their workforce participation. Individual and employer-sponsored  retirement accounts serve as important supplements to Social  Security as income replacements in retirement.

Caregivers may have lower Social Security benefits. Caregivers  may have less in Social Security benefits if they reduce their  workforce participation. Social Security benefits are calculated using  the highest 35 years of earnings. If a caregiver retires after working for  33 years, he or she would have 2 years of zero income in their benefit  calculation, which would result in lower benefits throughout retirement  compared to what their benefit would have been if they had a full 35- year earnings history. Social Security makes up a large portion of  retirement income from many older Americans, so a lower Social  Security benefit could have significant consequences for financial  security.

Four Policy Categories Encompass Actions That Could Improve Caregivers’ Retirement Security

We identified four policy categories that could potentially address  retirement security challenges faced by caregivers. To do so, we  identified specific actions that could improve caregivers’ retirement  security based on a review of literature and interviews with experts. We  then grouped these actions into four categories: 1) decrease caregivers’  out–of-pocket expenses, 2) increase caregivers’ workforce attachment  and wage preservation, 3) increase caregivers’ access or contributions to  retirement accounts, and 4) increase caregivers’ Social Security  benefits. See figure 12 for example actions in each category.

Experts Said Some Policy Categories Could Better Help Women and Low- Income Caregivers and All Have Costs

Experts we interviewed identified potential benefits of each of the four  policy categories. They also identified specific groups of parental or  spousal caregivers who could benefit, including women, lower-income  caregivers, and working caregivers (see table 2). As discussed  previously, women were more likely to provide parental and spousal care,  to work part-time, and to have lower earnings than men caregivers. In  addition, over one-third of parental caregivers and almost two-thirds of  spousal caregivers were in the bottom two income quartiles, and  caregivers in the bottom earnings quartile were more likely to provide  care daily.

Experts also said all four categories have potential costs and challenges  (see table 3).

Experts identified three implementation issues that would need to be  addressed regardless of the policy category.

Determining responsibility for implementation. It is unclear who  would be responsible for implementing and funding certain actions  under each approach, according to experts. Some may require  legislative changes, steps by employers, or public-private partnerships  that integrate both sectors. The RAISE Family Caregivers Act enacted  in January 2018 requires the Department of Health and Human  Services (HHS) to develop a strategy, including recommendations  related to financial security and workforce issues, to support family  caregivers and to convene an advisory council to help develop the  strategy. The advisory council will include representatives from  federal agencies, employers, state and local officials, and other  groups. Between October 12, 2018 and December 3, 2018, HHS  sought nominations for individuals to serve on the advisory council.

Defining caregiving for benefit eligibility. Experts said some  actions may require a definition of caregiving to use in determining  eligibility for benefits. Current definitions related to federal caregiving  policy vary. For example, FMLA defines a caregiver by specific  familial relationships. In contrast, the RAISE Family Caregivers Act  defines a family caregiver more broadly as an “adult family member or  other individual who has a significant relationship with, and who  provides a broad range of assistance to, an individual with a chronic  or other health condition, disability, or functional limitation.”

Identifying and verifying caregivers. Experts said some actions  may require a mechanism for identifying and verifying a caregiver’s  status. Experts noted that many caregivers do not identify themselves  as such, particularly those caring for a spouse, and therefore do not  claim existing benefits. In addition, certain actions may require a  decision about whether benefits extend to the primary caregiver or to  all caregivers, for example, siblings who may jointly provide care to a  parent.

Experts Said Implementing Actions across Policy Categories and Enhancing Public Awareness Would Help Address Caregivers’ Needs

Several experts we interviewed said caregivers could benefit more from a  retirement system that incorporates actions across the policy categories  so that actions can work in tandem to address caregivers’ needs. For  example, if caregivers have lower out-of-pocket caregiving costs, they  might be able to contribute more to their retirement savings. If caregivers  can contribute more to their retirement savings because they have better  access to accounts, they might have to rely less on Social Security in  retirement. Some experts pointed to Hawaii’s Kupuna Caregivers  Program as an example of a program with complementary goals—to  alleviate out-of-pocket expenses and reduce barriers to staying fully  employed while providing care for a family member. Specifically,  according to experts, the program provides a financial benefit of $70 per  day for up to 365 days to caregivers who work at least 30 hours a week to  spend on respite care, home health care workers, meal preparation, and  transportation costs for a care recipient age 60 or older. Although the  program is in the early stages of implementation, experts said several  states already see it as a model for meeting these two goals.

Experts also said it would be helpful to implement actions that address  the needs of caregivers in the long- and short-term and across their  lifespans. In general, experts said each of the policy categories could help  longer-term caregivers more than short-term caregivers. However, they  said certain actions to decrease caregivers’ out-of-pocket expenses or to  increase workforce attachment could also help in addressing immediate  needs. For example, experts said actions such as paid time off and  flexible work schedules could help those caring for individuals with acute  conditions to attend doctor’s appointments. Experts also said policies  should address the needs of caregivers with different levels of workforce  attachment. For example, one expert said there are disparate policy  impacts to consider depending on whether someone is a salaried worker,  an hourly worker, or a caregiver who does not work. Similarly, someone  who depends on other types of government assistance, such as Social  Security Disability Insurance, may also have different needs. Another  expert said the age at which caregiving takes place may impact  retirement security; people may be caring for older parents or a spouse at  a point in their careers when they are supposed to be catching up on  retirement contributions or have peak earnings, so they may not be able  to make up for lost time in terms of retirement savings.

Finally, several experts mentioned public awareness as critical to helping  people understand the implications of caregiving on retirement security.  They stressed the importance of financial literacy and making caregivers  aware of existing and new benefits. Experts said people are not well  informed about their Social Security benefits or their options for private  retirement savings. In addition, it can be difficult to understand the long- term impacts of becoming a caregiver, and experts pointed to the need  for education about how the decision, along with those to leave the  workforce or reduce workforce participation, could affect caregivers’ long- term financial security. One expert noted that education and services that  help families proactively think about their financial security and plan for  caregiving needs could be useful. Educating the public about what  supports exist, new supports as they become available, and eligibility and  enrollment procedures, is critical to ensuring caregivers take advantage of  available supports.

We provided a draft of this report to the Department of Labor, the  Department of Health and Human Services, the Department of the  Treasury, and the Social Security Administration for review and comment.  The Departments of Labor, Health and Human Services, and the  Treasury provided technical comments, which we incorporated as  appropriate. The Social Security Administration told us they had no  comments on the draft report.

As agreed with your offices, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from the  report date. At that time, we will send copies to the appropriate  congressional committees, the Secretaries of Labor, Health and Human  Services, and Treasury, the Acting Commissioner of Social Security, and  other interested parties. In addition, the report will be available at no  charge on the GAO website at http://www.gao.gov.

If you or your staff have any questions about this report, please contact  me at (202) 512-7215 or jeszeckc@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this report. GAO staff who made contributions to this  report are listed in appendix IV.

Appendix I: Objectives, Scope, and Methodology

The objectives of this review were to (1) examine what is known about the  size and characteristics of the parental and spousal caregiving  population, including differences among women and men; (2) examine  the extent to which parental or spousal caregiving affects retirement  security; and (3) identify and discuss policy options and initiatives that  could improve caregivers’ retirement security. This appendix provides  information about the methods we used to answer these questions.  Section I describes key information sources we used, and section II  describes the empirical methods we used to answer the first and second  research questions and the results of supplementary analyses.

To answer our research questions, we analyzed data from three  nationally representative surveys—the American Time Use Survey  (ATUS), the Health and Retirement Study (HRS), and Caregiving in the  U.S.—conducted an extensive literature search, and interviewed relevant  experts or stakeholders. This section provides a description of our data  sources and the steps we took to ensure their reliability for the purposes  of our review.

To answer the first objective, we analyzed data collected through ATUS’  eldercare module from 2011 through 2017, the most recent year of data  available. The ATUS—which is sponsored by the Bureau of Labor  Statistics and conducted by the U.S. Census Bureau—provides nationally  representative estimates of how, where, and with whom Americans spend  their time. Individuals interviewed for the ATUS are randomly selected  from a subset of households that have completed their eighth and final  month of interviews for the Current Population Survey (CPS). Starting in  2011, the ATUS began asking questions about eldercare. We weighted  the data and calculated relative standard errors to reflect CPS guidance  on the sample design. A relative standard error is equal to the standard  error of a survey estimate divided by the survey estimate.

We analyzed data used in the 2015 Caregiving in the U.S. study  sponsored by the National Alliance for Caregiving and the AARP Public  Policy Institute to estimate job impacts of parental and spousal caregiving  for working caregivers. The survey was conducted through online  interviews. To identify caregivers, respondents were asked whether they  provided unpaid care to a relative or friend 18 years or older to help them  take care of themselves. Respondents were also asked to whom they  provided care, which allowed us to identify parental and spousal  caregivers. We considered someone to be a parental caregiver if they  provided care to a parent or a parent-in-law. We considered someone to  be a spousal caregiver if they provided care to a spouse or partner. To  determine the job impacts of caregiving, respondents were asked whether  they were currently employed while providing care or whether they were  employed in the last year while providing care and whether they  experienced any of the following job impacts as a result of caregiving:

Went in late, left early, or took time off during the day to provide care

Went from working full-time to part-time, or cut back hours

Received a warning about performance or attendance at work

Lost any job benefits  All estimates derived from random samples are subject to sampling error.  All percentage estimates from this survey have margins of error at the 95  percent confidence level of plus or minus 5 percentage points or less,  unless otherwise noted.

To analyze the effects of caregiving on retirement security, we analyzed  data collected through the HRS, a nationally representative survey  sponsored by the National Institute on Aging and the Social Security  Administration and conducted by the Survey Research Center at the  University of Michigan’s Institute for Social Research. This biennial  longitudinal survey collects data on individuals over age 50 and contains  information on unpaid parental and spousal caregivers. Each biennial  period is referred to as a “wave.” The HRS includes both members of a  couple as respondents. There are currently 12 waves of core data  available from 1992 to 2014 with about 18,000 to 23,000 participants in  any given wave. The initial 1992 cohort consisted of respondents who  were then ages 51 to 61, and these respondents have been interviewed  every 2 years since 1992. New cohorts have been added over time to  maintain the representation of the older population from pre-retirement  through retirement and beyond. We used data from 2002 to 2014 for our  analyses; we did not use data prior to 2002 because data on spousal  caregivers were formatted differently. We adjusted asset and income  values for inflation. We weighted the data and calculated standard errors  to reflect HRS guidance on the sample design.

For each of the datasets described above, we conducted a data reliability  assessment of variables included in our analyses. We reviewed technical  documentation, conducted electronic data tests for completeness and  accuracy, and contacted knowledgeable officials with specific questions  about the data. We determined that the variables we used from the data  we reviewed were sufficiently reliable for the purposes of describing and  comparing the caregiving populations to each other or to non-caregivers.  We also cited studies conducted by other researchers to supplement our  findings; each of these studies was reviewed by two social scientists with  expertise in research methodology and was found to be sufficiently  methodologically sound for the purposes of supplementing our  descriptions or comparisons.

To gain an understanding of policy options that could improve caregivers’  retirement security, we reviewed prior GAO work, conducted an extensive  literature review of journal articles, working papers, and think-tank studies  on caregiving and topics related to retirement security, and conducted  preliminary interviews with experts in caregiving or retirement security.  Based on this information, we identified specific actions that could affect  caregivers’ retirement security, which we categorized into four different  categories based on common themes. We then conducted semi- structured interviews with or received written responses from a range of  experts and stakeholders—including some of the experts we met with to  identify specific policy actions—to obtain their views on the benefits and  costs of the specific policy options and approaches we identified, and we  also asked them to identify any additional actions. We selected experts  and stakeholders who are engaged in research or advocacy around  caregiving or retirement issues, or those who might be affected by the  actions identified. We also aimed to interview experts or stakeholders  who might have different viewpoints regarding the identified actions. See  table 4 for a list of the experts or stakeholders we interviewed or received  written comments from over the course of our work.

Section II: Methods for Analyzing Parental and Spousal Caregivers’ Characteristics and the Effect of Caregiving on Retirement Security

This section discusses the quantitative analysis methods we used to  describe the characteristics of parental and spousal caregivers and the  regression analyses we conducted to estimate the impact of caregiving  on retirement security. We used ATUS and HRS data for these analyses.

Characteristics of Parental and Spousal Caregivers

To describe the characteristics of parental and spousal caregivers, we  conducted descriptive analyses to examine differences between parental  and spousal caregivers and the general population. For all univariate and  multivariate statistics calculated using the ATUS data, we constructed  variance estimates using replicate weights.

The ATUS eldercare module defines caregiving as “assisting or caring for  an adult who needed help because of a condition related to aging.” The  eldercare module contains one observation per eldercare recipient, and  for each recipient, includes information about the duration of care  provided to the recipient, the age of the recipient, the relationship of the  recipient to the care provider, and whether the care recipient and the care  provider share a household. To analyze data on eldercare providers  rather than recipients, we restructured the data into a single observation  per care provider. While any given care provider could provide care to  multiple recipients, we defined care provider types as follows:

Spousal caregivers were those who provided care to a spouse or  cohabiting domestic partner, regardless of whether they also provided  care to another person.

Parental caregivers were those who provided care to a parent or  parent-in-law, regardless of whether they also provided care to  another person.

Caregivers of another relative were those who provided care to  someone related to them (such as a grandparent or aunt or uncle),  regardless of whether they also provided care to another person.

Caregivers of a non-relative were those who provided care to an  unrelated person, such as a friend or neighbor, regardless of whether  they also provided care to another person.

Data on frequency of care—how often a respondent provided eldercare— is collected once for each care provider, rather than for each recipient,  and therefore did not require restructuring. However, as noted above,  data on the duration of care—how long a respondent provided care—is  collected for each care recipient. Therefore, we analyzed the duration of  care for the relevant care recipient (parent or spouse) using the same  caregiver types as described above. For example, if someone provided  both parental and spousal care, the duration of care for the relevant  recipient would be used.

We conducted descriptive analyses to examine parental and spousal  caregivers’ characteristics including gender, age, race and ethnicity,  marital status, level of education, employment status, and earnings. The  following are important considerations of these analyses:

Age. We examined caregivers who provided care to an adult recipient  of any age, and, except where indicated in the text, we compared the  characteristics of adult caregivers to the general adult population of all  ages. We used four age categories (15 to 44, 45 to 50, 51 to 64, and  65 and older). We chose these age groups so that we could examine  the characteristics of care providers with a similar age profile to those  we examine in our analysis of household income and assets.

Presence of a living parent. We did not have information in the  ATUS to determine whether those who provided parental care had  living parents; therefore, our analyses included all parental caregivers  who said they provided care to a parent or parent-in-law within the  past three to four months, even if the parent was deceased by the  time of their interview. Certain analyses, where indicated in the text,  control for the presence of a parent in the respondent’s household.

Earnings. ATUS provides current information on respondent’s usual  weekly earnings at their main job. Because we did not have current  information on earnings from all jobs, for this analysis only, we  restricted the sample to those respondents who have a single job.  Because we did not have current information on self-employment  income, we restricted our analysis of earnings to those respondents  who are wage and salary workers.

In our report, we present data on the unadjusted demographic and  economic characteristics of caregivers and the general population. We  present the unadjusted characteristics so that readers can view the actual  demographic profile of caregivers. However, we also conducted logistic  regression analyses that predict the likelihood of caregiving as a function  of various demographic and economic characteristics and found that most  characteristics are qualitatively similar in the multivariate and univariate  context. Our independent variables for this multivariate analysis were  age, education, gender, marital status, race, ethnicity, and labor force  status—employed, unemployed, or not in the labor force. Where  indicated, as mentioned above, we included a categorical variable for  whether the respondent’s parent lives in the respondent’s household.  Where indicated, we included quartiles of usual weekly earnings; in  logistic regressions that included weekly earnings as an independent  variable, the analyses were restricted to wage and salary workers with a  single job. See appendix III for more detail about these logistic regression  analyses.

Effect of Parental and Spousal Caregiving on Retirement Security

To analyze the impact of caregiving on retirement assets and income, we  compared the assets and retirement income of caregivers and non- caregivers. We conducted separate analyses for each type of care, as  described below.

To determine the effect of spousal caregiving on retirement security, we  took two approaches:  1.  We conducted descriptive analyses to examine differences between  spousal caregivers and non-caregivers in terms of assets at or near  retirement and Social Security income during retirement. We also  examined differences between spousal caregivers and non-caregivers  in terms of work, education, and health status of both the person  providing and the person receiving care.  2.  We conducted regression analyses to examine whether observed  differences in assets and Social Security income were still statistically  significant when we controlled for these differences in the spousal  caregiving and non-caregiving populations.

In order to construct our analysis sample of spousal caregivers, we took  the following steps. First, we identified married individuals at ages 65 or  66. We chose these ages because they are at or near the full retirement  age at which individuals can receive unreduced Social Security benefits.  We then identified the respondents that provided spousal care in the  current wave or in the prior two waves of data, a 6-year period of time. To  determine whether someone provided spousal care, the HRS asks the  respondent whether they received help with activities of daily living  (ADLs) or with instrumental activities of daily living (IADLs) and who  helped with these activities. If the respondent indicated that their spouse  or partner provided help, we then identified that person as a spousal  caregiver. This resulted in a sample of about 5,000 observations. We  found that about 10 percent of the sample provided spousal care in the 6  years we examined.

We also obtained information on the asset levels, hours worked, and  other descriptive attributes at ages 65 or 66. To determine the level of  Social Security retirement income, we looked ahead to the household’s  Social Security income at age 71 using data from future waves of the  HRS because some individuals may receive benefits at a later age.

We found differences between spousal caregivers and non-spousal  caregivers, and differences were often statistically significant (see table  5). As the table shows, spousal caregivers tended to have lower asset  levels—IRA assets, non-IRA assets, or defined contribution account  balances—as well as lower levels of Social Security income. Although  the asset levels of spousal caregivers did not increase as much as for  non-caregivers, the differences were not statistically significant. Spousal  caregivers also tended to work fewer hours, were less likely to have a  college degree, and were more likely to be in self-reported poor or fair  health.

Spouses receiving care also had different characteristics than spouses  not receiving care, indicating that the care recipient also could affect  household assets. Spouses receiving care tended to work less and to be  in poorer self-reported health. Spouses receiving care also worked fewer  hours—1,100 compared to 2,700 for spouses who did not receive care  (see table 5). About 66 percent of spouses that received care were in  self-reported fair or poor health, as opposed to 15 percent of those who  did not receive care.

We also compared differences between spousal caregivers and non- caregivers by gender (see table 6). We found some of the same  differences between men and women spousal caregivers and non- caregivers as we did among spousal caregivers and non-caregivers more  generally. However, there were also additional differences. For example,  among women, growth in assets was larger among caregivers, and was  statistically significant. However, differences in the cumulative hours  worked was not statistically significant.

In order to investigate whether observed differences in retirement assets  or income might be due to factors other than caregiving, we controlled for  additional variables using a multiple regression. Specifically, we  generated a binary variable which took the value of one if the respondent  had provided spousal care and took the value of zero if not and examined  the estimated coefficient on this variable. We ran six different regression  models for each of the assets, with six different sets of controls, in  addition to the spousal caregiving variable. The different models are as  follows, with each building on the model prior. Unless otherwise noted,  the findings presented in the report are from model 5.

Model 1 estimated the differences, with only controls for the year of  the wave. This helps control for the effects that would be experienced  by all retirees in that year, like an economic recession.

Model 2 included the controls from model 1 and also whether the  person has a college degree. This helps control for the effects of  education on assets and income.

Model 3 included the controls from models 1 and 2 as well as  earnings for the respondent in the period before we observed them  caregiving. This helps control for caregivers having lower earnings  before caregiving, which could affect assets and income.

Model 4 included the controls from models 1, 2, and 3 and also  demographic characteristics, such as race and ethnicity, which can be  associated with assets or income.

Model 5 included the controls from models 1, 2, 3, and 4 and also  controlled for the self-reported health of the potential caregiver.

Model 6 included the controls from models 1, 2, 3, 4, and 5 and also  controlled for the self-reported health of the potential care recipient.  Having a spouse in poor health might affect assets or income, even if  no caregiving was provided.

We estimated effects on four different types of assets and income at ages  65 and 66: IRA assets, non-IRA assets, defined contribution balances,  and Social Security income (see table 7). We took the logarithm of the  value before running the regression to normalize the distribution. We also  considered the possibility that caregiving might not only affect the level of  assets, but might affect the accumulation or growth of assets. We did that  by including models that estimated the effect on the growth of IRA and  non-IRA assets.

The table below shows the parameter estimates of the effect of spousal  caregiving with different levels of controls or dependent variables. In the  table, the columns represent the different models (1 through 6). The rows  represent different dependent variables—different types of assets or  Social Security income for which we estimated the effect of spousal  caregiving. In the table, the upper panel shows the effects on women’s  assets and income based on caregiving. The middle panel shows the  effects on men’s assets and income based on caregiving, and the final  panel shows the effect when the men’s and women’s samples were  pooled. As the table shows:

For women, men, and when the sample was pooled, we found  significant negative effects of spousal caregiving on both IRA and  non-IRA assets. However, the coefficient decreased in magnitude  when we added additional controls. For example, when we controlled  for the health of the person receiving the help, the coefficient almost  fell by half, from about .5 to about .25 in the case of non-IRA assets.  This indicates that it is difficult to differentiate the effect of spousal  caregiving from the effect of having a spouse in poor self-reported  health.

For women, men, and when the sample was pooled, we found  significant negative effects of spousal caregiving on Social Security  income. But for men, the effect was only significant at the 10 percent  level for models with fewer controls. In addition, when we added  controls for demographics and health, the effect for men no longer  was significant.

For the growth of assets, we found negative effects for non-IRA  assets for women, but not for men and not for the pooled sample.  However, the effects were only significant at the 10 percent level and  not significant when we controlled for the health of the care recipient.

In addition to the regression coefficients, we also calculated the  differences in percent terms, which may be easier to interpret (see table  8). We found results that were strongest when comparing women  spousal caregivers to women who did not provide spousal care. The  effect for women was resilient to the inclusion of controls. In the model  that included the health of the recipient (model 6), the effect ranged from  a 40 percent reduction in IRA assets, to an 8 percent reduction in  household Social Security income. For men, we found effects for IRA  assets, but the effects for Social Security income were not resilient to the  inclusion of controls besides the education of the recipient.

To determine the effect of parental caregiving on retirement security, we  conducted descriptive analyses to examine differences between parental  caregivers and non-caregivers in terms of assets at or near retirement  age and Social Security income during retirement.

In order to construct our analysis sample of parental caregivers, we took  the following steps. First, we identified individuals at age 65 or 66 who  had living parents or parents-in law. We made this restriction because  having living parents at ages 60 to 66 (and the opportunity to provide  care) might be associated with higher socio-economic strata. Therefore,  we did not want to compare caregivers to those who did not provide care  because their parents were deceased. We then identified the  respondents that provided parental care in the current wave or in the prior  two waves of data. To determine who is a parental caregiver, the HRS  asks respondents two separate questions. The first asks whether a  respondent spent a total of 100 hours or more since their last interview or  in the last 2 years helping a parent or parent-in-law with basic personal  activities like dressing, eating, or bathing. The second question asks  whether a respondent spent a total of 100 hours or more since their last  interview or in the last 2 years helping a parent or parent-in-law with other  things, such as household chores, errands, or transportation. We limited  the analysis to those with living parents or in-laws. This resulted in a  sample of about 2,499 observations. We found that about 57 percent of  the sample provided parental care in the 6 years we examined.

Unlike our analysis of spousal caregivers, we found that parental  caregivers had higher levels of assets at or near retirement than non- caregivers, but differences between parental caregivers and non- caregivers were not statistically significant (see table 9).

Appendix II: Characteristics of Different Types of Caregivers

The following tables provide information about the characteristics of  various types of eldercare providers.

Appendix III: Multivariate Analysis of the Probability of Providing Care

Table 13 shows the adjusted odds of providing care for people with  different economic and demographic characteristics, from multivariate  analyses. Models 1, 2, 3 and 4 show the adjusted odds of providing  parental care, and models 5 and 6 show the adjusted odds of providing  spousal care.

Model 1 estimates the probability of providing parental care as a  function of gender, age, marital status, race, education, and labor  force status.

Model 2 estimates the probability of providing parental care as a  function of gender, age, marital status, race, education, and income  quartiles. This model is restricted to employed workers, and therefore  does not include labor force status as a regressor.

Model 3 is identical to model 1, except that model 3 includes an  indicator for whether the parental caregiver and the parental care  recipient live in the same household.

Model 4 is identical to model 2, except that model 4 includes an  indicator for whether the parental caregiver and the parental care  recipient live in the same household.

Model 5 estimates the probability of providing spousal care as a  function of gender, age, marital status, race, education, and labor  force status.

Model 6 estimates the probability of providing spousal care as a  function of gender, age, marital status, race, education, and income  quartiles. Like model 2, this model is restricted to employed workers,  and therefore does not include labor force status as a regressor.

Appendix IV: GAO Contact and Staff Acknowledgments

In addition to the contact named above, Erin M. Godtland (Assistant  Director), Nisha R. Hazra (Analyst-in-charge), Benjamin Bolitzer, Jessica  Mausner, and Rhiannon C. Patterson made key contributions to this  report. Also contributing to this report were Susan Aschoff, Deborah  Bland, Justin Fisher, Avani Locke, Michael Naretta, Mimi Nguyen, Rachel  Stoiko, Shana Wallace, and Adam Wendel.

About 10% of Americans per year cared for an elderly parent or spouse from 2011 through 2017. These family caregivers may risk their long-term financial security if they have to work less or pay for caregiving expenses such as travel or medicine.

More than half of people who cared for parents or spouses said they went to work late, left early, or took time off for care

Spousal caregivers at or near retirement age had less in retirement assets or Social Security income than non-caregivers

Experts and studies identified ways to potentially improve caregivers' retirement security, such as increasing their Social Security benefits