The Missing Piece in Your Retirement Plan: Long-Term Care and Family

Let me start with a question: When you picture your retirement, what do you see?

Perhaps it's mornings on the deck with coffee, travel adventures you've been postponing, or simply the freedom to spend time doing what you love. What probably doesn't feature in that picture is a difficult conversation with your children about who will care for you when you can no longer manage on your own.

Yet this is exactly the conversation that could make or break your retirement plan.

Here's what happens in many families: Parents quietly assume their kids—especially the eldest or the one who lives closest—will step in when help is needed. The kids, meanwhile, may have entirely different expectations about their ability or willingness to provide care. Nobody talks about it openly until suddenly there's a crisis, and everyone is scrambling. There's often an unspoken assumption that children will automatically become caregivers, but this needs to be questioned before the need arises.

The reality? Nearly 60% of current caregivers are spending $640 per month out-of-pocket on the person they're caring for¹, and that's on top of the time, emotional energy, and career sacrifices involved.

In Canada, caregivers dedicate approximately 5.7 billion hours annually providing unpaid care to people with disabilities, medical conditions, and age-related needs.²

That's staggering. And it's not just about time. In 2021, nearly half of Canadian caregivers reported missing work to meet caregiving responsibilities, with some leaving the workforce entirely.³

When it comes to aging, you essentially have three options, each with distinct financial implications:

1. Aging in Place

It's what 96% of Canadians want—to stay in their own homes.⁴ It feels comfortable and familiar. But here's the catch: roughly 60% of people aged 65 and older weren't aware of the true cost of aging in place when they decided to do so.⁵

Think about your home right now. Those stairs you climb without thinking? That bathtub you've used for decades? They might become significant obstacles. Home modifications, assistive devices, and in-home care can quickly add up to $2,000-$4,000 per month or more, depending on your needs.⁶

2. Retirement Living

This is a social model focused on community and independence, with private-pay fees ranging from $4,500 to $12,000 per month.⁷ Meals and basic services are typically included, but be careful, additional assistance with daily tasks like bathing or getting dressed often comes with extra charges.

3. Long-Term Care

This is a medical model that requires government application, but in Ontario alone, there are 48,000 people on the waitlist.⁸ While it tends to be the most affordable option, access is far from guaranteed. If you can't get into long-term care, you need a backup plan—and the budget to support it.

Here's where things get even more complicated. Recent research shows that 76% of grandparents who provide financial support to their children or grandchildren say it's affecting their retirement savings - up significantly from 65% just a year ago.⁹

Among those who help family members financially, 67% are now covering everyday living expenses, while 28% are contributing to rent or mortgage payments.¹⁰ This means many Canadians are trying to support both their aging needs and their adult children simultaneously - a recipe for financial strain.

In response, 29% of seniors say they plan to reduce financial support to family members, while 36% are considering part-time work during retirement.¹¹

Start the conversation today

Don't wait for a health crisis to force these discussions. Waiting until the need arises puts everyone in crisis mode. Instead, have honest conversations with your family about:

Run the numbers

Work with your financial planner to model different scenarios. What if you need in-home care for five years? What if one spouse needs long-term care while the other remains independent? What if your retirement savings need to stretch to age 100 instead of 90?

Financial advisors now typically model retirement plans to age 95, up from the previous standard of 90, because Canadians are living longer and healthier lives.¹²

Understand your income sources

The maximum CPP payment at age 65 for 2025 is $1,433 per month, though the average payment is actually $899.67.¹³ If you're counting on Old Age Security and CPP alone to cover care costs, you'll likely face a significant shortfall.

Consider your insurance coverage

Review what health expenses your existing insurance covers. Many Canadians are surprised to learn that specialized medical equipment, in-home care, and other essential supports aren't covered by provincial health plans or their group benefits once they retire.¹⁴

Here's what I want you to take away from this: Your children love you. But love doesn't automatically translate into the ability, availability, or even desire to be your primary caregiver. And that's okay.

The key is having realistic conversations with the people you believe will be part of your plan, rather than making assumptions about what your kids want or can do.

The most loving thing you can do for your family, and for yourself, is to plan ahead. Build a financial cushion for care costs. Have the difficult conversations now, while everyone is calm and healthy. Put legal documents in place. Explore your options before you need them.

Because retirement should be about enjoying the life you've worked so hard to build, not scrambling to figure out care arrangements in the midst of a crisis.

Ready to create your personalized retirement and care plan?

Let's sit down together and map out a strategy that honours your vision for retirement while ensuring you have the financial resources to support it. We'll help you:

✓ Calculate realistic care costs for different scenarios
✓ Identify gaps in your current retirement plan
✓ Facilitate family conversations with a neutral third party
✓ Build a comprehensive financial strategy that gives you peace of mind

Your future self will thank you.

P.S. Already having these conversations with your family? That's wonderful! Forward this newsletter to someone who might benefit from starting theirs.

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