facebook twitter instagram linkedin google youtube vimeo tumblr yelp rss email podcast phone blog external search brokercheck brokercheck Play Pause
Retired Military Finances 201: What Do Caregivers Need to Know About Retiring Early? Thumbnail

Retired Military Finances 201: What Do Caregivers Need to Know About Retiring Early?

Retirement Funding

It may just be me, but it seems like siblings that retired from the military or are married to a retired military member are more likely to be caregivers for aging parents (I might be biased). If that is indeed the case, it might be worth planning for it. Enter November, National Family Caregiver Month, an opportunity to honor the physical, mental and emotional effort caregivers put into their role every day. When looking after a loved one, it’s important to understand the financial challenges this life milestone can create.

Whether by choice or necessity, many caregivers may find themselves retiring early. If you’re exiting the workforce, there are a few things to consider to make sure you and your family are supported. 

How to Plan for Becoming a Caregiver

As part of the “sandwich” generation, you have a lot on your plate. You may be raising children or helping them launch, taking care of aging parents and managing your other personal responsibilities. For many people, juggling all of these tasks might include retiring early to become a full-time caregiver. Here are a few things to consider if you find yourself leaving the workforce to care for a loved one. 

1. Understand Your Resources

When faced with the responsibility of becoming a full-time caregiver, you might think that your only option is to leave the workforce. But there are a few other resources available that may be useful in your situation. 

The Family Medical Leave Act allows for “eligible employees of covered employers to take unpaid, job-protected leave for specified family and medical reasons.”1 Check with your company if they offer this coverage. 

You may also be eligible to receive Medicaid, which can allow qualified individuals to manage their own home-care services. Medicaid differs by state, so contact your state’s Medicaid program to see if you or your loved one qualify.2

2. Have an Income Plan

Planning for retirement takes careful strategizing and becoming a caregiver adds a new wrinkle. By retiring early, you may miss out on ongoing contributions to an employer-sponsored retirement plan. In addition, you may not have access to Social Security, Medicare or pensions yet. You may also be hit with withdrawal penalties if you want to access your retirement funds early. 

However, even with these additional complications, it’s still possible to prepare ahead for any income gaps. Working with a qualified retirement planning financial professional is key to making this transition a smooth one. 

3. Consider Your Future

Every caregiving situation is different, and it’s important to consider both your short-term and long-term goals. Do you plan to take on a part-time job if you have the time and capacity? Do you want to re-enter the workforce? Are there other options available so you can still work while your loved one is taken care of? Having a clear sense of what you want for yourself can help you plan for your financial situation in the coming years. 

4. Plan for the Emotional Changes, Too

While it’s important to plan for the financial changes of becoming a caregiver, it’s important to consider the emotional changes as well. Being a caregiver can be hugely rewarding but can also take a toll on your mental health. 

Consider ways to maintain your connections to your community while being out of the workforce. This could include joining a support group with other caregivers, picking up a new hobby or making time to connect with friends and family more often. There are also mental health professionals who specialize in working with caregivers. You don’t need to trade your own mental health for the health of your loved one. A healthy, happy caregiver is a confident caregiver.

Military Finances are Different

There’s a lot to consider when becoming a caregiver, especially if you plan to retire early to focus on your new role. If you do have a military retirement you're ahead of a lot of your civilian counterparts. That is often the case. Your finances are different than a civilian. That's why we think you should work with a financial planner that works with Active and Retired Senior Military Officers and NCOs. If you'd like to find out how we work with military professionals like you, use the link below to schedule a free initial consultation.

If you found this article useful, you might like the following blog posts:

Retired Military Finances 101: How Confident are You About Your Retirement Compared to Your Peers?


How Much Do I Need to Make After Military Retirement?


Retired Military Finances 301: Why Retirement Planning Is Different for Business Owners




  1. https://www.dol.gov/agencies/whd/fmla
  2. https://www.medicaid.gov/about-us/contact-us/contact-state-page.html

This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.

Disclaimer
Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by C.L. Sheldon & Company, LLC ), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. C.L. Sheldon & Company, LLC does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to C.L. Sheldon & Company, LLC website or incorporated herein, and C.L. Sheldon & Company, LLC takes no responsibility therefore. All such information is provided solely for convenience, educational, and informational purposes only and all users thereof should be guided accordingly. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from C.L. Sheldon & Company, LLC . To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. C.L. Sheldon & Company, LLC is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the C.L. Sheldon & Company, LLC ’s current written disclosure statement discussing our advisory services and fees is available for review upon request. DISCLAIMER OF TAX ADVICE: Any discussion contained herein cannot be considered to be tax advice. Actual tax advice would require a detailed and careful analysis of the facts and applicable law, which we expect would be time consuming and costly. We have not made and have not been asked to make that type of analysis in connection with any advice given in this blog post. As a result, we are required to advise you that any Federal tax advice rendered in this blog is not intended or written to be used and cannot be used for the purpose of avoiding penalties that may be imposed by the IRS. In the event you would like us to perform the type of analysis that is necessary for us to provide an opinion, that does not require the above disclaimer, as always, please feel free to contact us.