Okay, Willy Wonka fans: remember when young Charlie Bucket looked down into the storm grate and found the shiny coin that allowed him to buy the Wonka Bar that was wrapped in the fifth golden ticket? Talk about found money making a big difference for a family. Incidentally, a family that included four aging parents and the daughter who cares for them.

If only all Americans who are caring for aging family members could find the money you need to keep your aging family members safe, your families afloat, and your own retirement savings intact. It’s not like you need to inherit a chocolate factory (but who would say no to that?). It would just be nice to find some way to offset the costs of caregiving. According to AARP, on average, caregivers spend $7,200/year providing care, and 39% of caregivers have to stop working in order to provide that care.

There are dozens of ways that family caregivers can save money on caregiving expenses. Now learn where you can find money. This is money that already exists and can be used to help cover caregiving costs. The first step is knowing where to look for it. Three great places to start are your family member’s Medicare plan, their life insurance policy if they have one, and grants.

Medicare Advantage supplemental benefits

Adults over 65 can access health insurance through a traditional Medicare plan or a Medicare Advantage (MA) plan. MA plans, also known as Medicare Part C, are offered by private insurance companies, like United Healthcare, Humana, Aetna, Cigna, among others. These plans are incentivized to deliver high-quality care and to proactively manage members' health to avoid unnecessary (and costly) care services. In other words, the plans get to keep more of their profits (and share less with Medicare) when they keep their members healthy and happy.

One of the ways Medicare Advantage plans promote their members’ well-being is by providing “supplemental benefits.” These are benefits that go above and beyond traditional Medicare Parts A and B benefits. They often include dental, vision, and mental health coverage. So you can see where they can provide substantial savings. But savings are just the beginning.

Depending on the Medicare Advantage plan, some supplemental benefits include:

• An over-the-counter benefit that includes a card loaded with $215/month that you can spend on healthy food, over-the-counter meds, personal care products, transportation, utilities, pet supplies, and rent/mortgage assistance
• A $150 annual allowance to purchase certain approved home and bathroom safety devices
• A personal emergency response system, at no cost to you, and more.

Each MA plan has its own unique assortment of supplemental benefits. Usually, families have to wade through thick brochures with long lists and confusing explanations to figure out what’s available to them. As a result, they leave a lot of these benefits—and this money—on the table.

Medicare's GUIDE Program for respite care benefits

The Centers for Medicare & Medicaid Services (CMS) is launching a new care model this year for people with Medicare who have dementia. It’s called “Guiding an Improved Dementia Experience” or simply “the GUIDE model.” One of the benefits this model will offer is up to $2,500 per year for respite services for qualified beneficiaries.

This respite care benefit will be available for eligible families beginning in July 2024.

How to access Medicare's new respite care benefit: 

1. Determine if your family member’s primary care provider or the provider organization (physician group practice or health system) is participating as a GUIDE provider. The easiest way to do this is to simply call and ask them. You can also contact their Medicare plan directly (the phone number is on their Medicare plan ID card) to inquire if any of the plan’s contracted providers in your area are participating as GUIDE providers.
2. Tell your family member’s GUIDE provider organization that you’d like to take advantage of the GUIDE Respite Care Benefit. The provider will then authorize and help arrange the approved respite care services based on your family member’s care plan.

GUIDE program respite care services may be provided in your family member’s home, at an adult day care center, or at a 24-hour care facility.

You can learn more about government programs that support older adults and their family caregivers in RubyWell’s guide to Resources & Services for Family Caregivers.

Early pay-outs from life insurance

If you care for a family member who has a life insurance policy, they may be able to access some of the death benefit prior to their passing, or sell the policy now for a portion of the death benefit. They can then use this early pay-out to help cover their costs. Here’s how the different life insurance strategies work.

Accessing an Accelerated Death Benefit

If your family member has been diagnosed with a terminal illness, check to see if their life insurance policy offers an accelerated death benefit. This benefit will allow them to access a portion of their death benefit while they’re still alive. Once they receive this pay-out, they can spend it any way they please, such as to pay for prescriptions, healthcare, utilities, a professional caregiver, or groceries. They could even choose to pay you for the care you provide to them.

Once the accelerated death benefit is claimed, the final death benefit will be smaller. For example, if the policy’s original death benefit was $100,000, and your family member claims $50,000 as an accelerated death benefit, their beneficiaries will split the remaining $50,000 upon your loved one’s passing.

Selling a Life Insurance Policy

If your loved one has a life insurance policy that doesn’t offer an accelerated death benefit, they can sell the policy, via a Viatical Settlement or Life Settlement, for a portion of the value of the death benefit. This puts money in their pockets immediately and turns their policy into an investment vehicle for the buyer.

If your family member has been diagnosed with a terminal illness, and has a short life expectancy, a viatical settlement would make the most sense for them. The viatical settlement would likely provide them with a larger payout than a life settlement would, because the buyer would receive the death benefit sooner, and therefore have to make fewer premium payments. So the return on their investment would be higher. If your family member is fairly healthy and has a longer life expectancy, they would choose a life settlement. The mechanics of both settlements work the same way.

Again, let’s say your family member owns a life insurance policy that will pay a $100,000 benefit upon their death to their beneficiaries. If they sell that policy through a life settlement company or viatical settlement company for $50,000, the buyer stands to see a return of up to double their investment upon your loved one’s passing: the full $100,000 benefit. The longer the buyer has to keep up with the premium payments, the lower the return on their investment. Meanwhile, your family member has $50,000 to use any way they see fit, including covering their care costs while they’re still alive.

The drawback to going the viatical settlement or life settlement route is that your family member’s beneficiaries won’t receive one penny of the death benefit. Finally, be sure to talk with an accountant before making this decision, so you can understand any tax implications.

Grants for Family Caregivers

A grant can provide financial assistance that you don’t ever have to pay back. That’s right—it’s free money. The purpose of a caregiving grant is to alleviate the financial burden and stress associated with caregiving responsibilities. These grants typically range in value from a few hundred to thousands of dollars. Depending on the scope of the grant, you can use the money to help cover the costs of caregiving, respite care, home modifications, medical equipment, or other related expenses.

Each grant has its own eligibility criteria. These often include factors such as the level of the care recipient’s disability or functional impairment, the family caregiver's income level, and the availability of other support services or long-term care programs. The application process usually involves submitting documentation that supports these claims.

Where to family caregivers can find grants 

The most challenging thing about the grant process is finding the grants in the first place. Caregiving grants are offered by government agencies, non-profit organizations, and private foundations. That’s a lot of places to have to look for the grant that suits your needs. Luckily, there are resources that can simplify your search.

The Administration for Community Living (ACL) funds services and supports for aging adults who choose to live at home. They provide an Eldercare Locator where you can enter your zip code and find resources available in your area (or call 1-800-677-1116 to be connected by phone). You can contact each of those resources to ask if they provide caregiving grants or can direct you to a local organization that does. One of the resources you’re likely to find on ACL’s Eldercare Locator is your local Area Agency on Aging (AAA). Your AAA often has information on grants. They may even be able to help you prepare your grant application(s).

Some organizations offer respite care grants. You may be able to use money from these grants to hire a paid caregiver or adult day care provider to fill in for you when you need some well-deserved R&R.

• Hilarity for Charity has an In-Home Care Grant Program for people caring for aging family members with Alzheimer’s disease or other dementias. These grants provide 3-6 months of free, professional, in-home care.
• The National Organization for Rare Disorders and the Multiple Sclerosis Foundation also offer grants to cover the cost of respite services.
• If your family member has a different chronic condition that requires in-home care, a support group for families dealing with that condition, or an organization supporting people with that condition may be able to point you to similar disease-specific grants.
• The Department of Veterans Affairs (VA) offers a Temporary Residence Adaptation (TRA) grant for retired service members with service-connected disabilities, who live in their family caregiver’s home. If the veteran you care for meets eligibility requirements, this grant of up to $47,130 can be used to pay for home modifications including ramps and grab bars, widening doorways, and installing accessible bathroom fixtures.
• Your loved one’s doctor’s office could be another great resource for finding grants. Ask if there’s someone in their office who can provide referrals to grants that could help support your loved one’s care.

Pro tip: If you have friends or family members who can’t help with day-to-day care tasks, consider asking them for help doing some of the footwork necessary to access these cash reserves. This is a great way to give a long-distance sibling an opportunity to feel like they’re contributing.

As you can see there’s money out there for family caregivers. Some of it’s easier to get your hands on than others. And it’s not like those hands of yours are idle.