Support for Carers: Improving Financial Wellbeing.

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Are you a carer looking for support for financial hardship? Learn about the support for carers that is currently available in Australia.

It’s National Carers Week from 16th to 22nd October, a time to acknowledge and recognise Australia’s 2.65 million dedicated family and friend carers. It’s also a time to recognise that the demands of caring for someone can be relentless and can take their toll physically, mentally and financially. Helping Australian carers to manage their money may help them to increase their confidence, reduce their stress and give them more time to care for their loved ones and themselves as well.

Understanding carers and their role.

Reducing your hours of work or giving up your job to look after a family member or friend who is older, disabled or seriously ill may not be something you’ve given much thought to. For about one in ten Australians this is their reality. In Australia there are about 2.65 million carers, including approximately 861,000 primary carers according to the ABS Survey of Disability, Ageing and Carers (SDAC) 2018. They collectively provide nearly 2.2 million hours of care a year, and the emotional and financial impact on these people should not be underestimated.

Carers NSW define carers as: “providing care and support to a family member or friend who has a disability, mental illness, drug and/or alcohol dependency, chronic condition, terminal illness or who is frail.”  This definition does not include paid care workers, formal volunteers, or parents / foster carers / kinship carers.  While frequently rewarding, caring for someone can also be very demanding and often restricts the lives of individual carers and their families.

The average age for carers is 51 years old, according to Carers NSW. However, there are a range of people of all ages caring for others. Young carers are people up to 25 years old who provide unpaid care and support to family members or friends. According to the ABS Survey of Disability, Ageing and Carers (SDAC) 2018, there are more than 235,000 young carers in Australia. The person they care for may be a parent, partner, sibling, their own child, other relative or friend.

The financial impact of caring.

The financial impacts of caring occur at individual, family, and societal levels. They include:

    • Reductions in available financial resources of the carer because of out-of-pocket expenses.
    • Potential for carers to experience financial stress, which may lower their wellbeing.
    • Employment-related costs for the carer who must reduce work hours, exit the labour force or reduce their participation in it, and forego income, benefits, and career opportunities in order to provide care.
    • Employment-related costs to employers who must replace workers who leave the labour force or reduce hours.
    • Societal benefits that include the potential cost savings to the formal health and long-term services and supports systems because of the care and support provided by family carers.

Many carers find it hard to cover their living expenses. Carers NSW 2020 National Carer Survey, showed that:

    • Most households represented had a gross income of less than $50,000 per year and received some form of Government income support.
    • One in four carers had spent more than they earned in the past 12 months.
    • One in four carers receiving the Carer Payment were experiencing financial distress.
    • Most carers were contributing financially to the costs of care for the persons they care for.

The challenging situation many carers face is understandable as their workforce participation is likely to be intermittent and even interrupted due to their responsibilities as carers. Further the financial challenges have a negative impact on carer wellbeing. 2020 survey results (national) found that respondents’ satisfaction with life was 18.2 percentage points lower than for the general Australian population. What’s more, is that psychological distress, tends to be more pronounced in carers. Carers NSW 2020 survey results (national) found that overall nearly half of all respondents (47.7%) reported high or very high psychological distress.

Due to their lower participation in the paid workforce, female and male carers are far more likely to have lower superannuation balances than other people. Carers NSW found that in Australia the average superannuation balances at the time of retirement (assumed to be age 60 to 64) in 2015-16 were $270,710 for men and $157,050 for women. Sadly, financial security for women is eroded by their caring roles.  Most primary carers (70.3%) are women, according to the ABS. This goes some way to explaining why they have lower superannuation balances and undermines their longer-term financial security.

Carers provide substantial support that may otherwise be funded by the taxpayer. Deloitte Access Economics estimate the replacement cost of caring at $77.9 billion in 2020, this cost is calculated by replacing each hour of informal care with a formal sector equivalent. Using an opportunity cost methodology, Deloitte Access Economics calculate the lost earnings, from reduced employment at $15.2 billion. Opportunity cost valuations tend to be lower than the replacement cost as it considers only those carers who would have otherwise been employed.

Managing your money as a carer.

Given that putting another person’s needs before their own can have an impact on carers’ finances, if you’re a carer, it’s worth understanding what help is available.

  • The Carer Gateway provides help to find in-person support services for carers, as well as information and resources on to support you in your caring role. By calling 1800 422 737 Monday to Friday between 8am and 5pm, you can talk to a Carer Gateway service provider who will help you access services and support. The Carer Gateway services include: counselling, respite care, connection with other carers, online skills courses and financial support packages.
  • Understand more about the government payments that you may be eligible for including:
      • Income support for carers through Carer Payment, which helps carers, who are unable to work in substantial paid employment, because they’re providing full time daily care for someone with a severe disability or medical condition or who is frail aged.
      • Carer Allowance. Which provides a fortnightly allowance for eligible people. Find out if you’re eligible to receive it.
      • Paid carer’s leave.
      • Services Australia has information on other financial help for carers.
      • Discover using Centrelink’s Payments and Services Finder tool what further help may be available for you.
  • Visit Westpac’s Caring for carers site for information about carer wellbeing, caregiver support and financial support for carers.

Here's a couple of tips to help carers to build solid financial footings for now and the future.

  • Budgeting. As a carer, if you can create and stick to a budget, you’ll be in a better position to manage your day to day expenses and perhaps even save for your future. Budgeting helps a person to determine what to spend and save so they can achieve what they want out of life. Budgeting is a key part of planning for how you’ll use your money and is covered as part of the Davidson Institute’s Financial Fitness Course.  This course also covers how to manage your money by identifying goals, saving and planning.
  • Set up a financial plan. If you’re caring for someone and want to ensure you and they are well prepared, you should have a plan.  A financial plan can help you build wealth over time, aiding the protection of your financial future. If that sounds like a good idea, it could be good to find a trusted financial adviser who can help you on this journey. It’s not just about planning for the future either. A financial adviser can help adjust your current situation as well as preparing you and your family for the years ahead.

Other help available: 

Carers Australia and the National Carer Network have a range of support services and programs available to help people to get the practical, financial and emotional support they need. Get in touch with the Carer Association in your state or territory to find out more:

If you’re a Young Carer, there is young carer specific support available through Carers Australia, the state and territory Carer Associations and the Carer Gateway Service Providers. Also Little Dreamers, a Westpac Foundation grant recipient is a community organisation that can help young carers to feel supported, valued and empowered through their short term and long term programs.

Content current as of September 2022.

This information is general in nature and has been prepared without taking your objectives, needs and overall financial situation into account. For this reason, you should consider the appropriateness for the information to your own circumstances and, if necessary, seek appropriate professional advice. © Westpac Banking Corporation ABN 33 007 457 141 AFSL and Australian credit licence 233714.

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Lali Wiratunga

Lali Wiratunga believes in encouraging positive financial behaviours to boost people’s financial confidence and help organisations to deliver social impact. In 2016, Lali was recognised for creating a positive impact through Pro Bono Australia’s Impact 25. Following a career as a corporate lawyer and management consultant in the UK, he's had 17 years experience in roles across financial services in Australia. He serves in the community as a Board Director of Plate it Forward, a food-based social enterprise that drives equal opportunity through creating opportunities to employ, train and educate individuals who might otherwise be prevented from entering the workforce.

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