In-Home Care Costs Have Soared for Older Households
Most adults hope to age at home, but rising care costs are forcing many families to pull from savings or take on extra work.
Updated on Oct. 12, 2026 in Financial Planning
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A recent study found that 83% of older Americans prefer aging in their own homes, yet the financial burden of this choice is becoming a significant strain on households. Many caregivers are already reducing their personal spending and tapping into emergency funds to cover these mounting expenses.
Why it matters
Financial advisors often underestimate the true cost of aging in place, leaving many families unprepared for the long-term impact on their retirement savings. As expenses rise, households face tough decisions about labor participation and current budget management.
The study included a survey of 4,375 U.S. adults, with 32% of current caregivers already reducing their spending and 21% working additional hours to manage costs. In 2026, eight hours of daily in-home care is projected to cost $105,120, a figure expected to rise to over $552,000 by 2060.
The players
Northwestern Mutual
A financial services firm that provides insurance, investment, and retirement planning products to households.
Annalee Kruger
An expert who developed a certificate program to train financial advisors on serving the needs of clients aged 85 and older.
bQuest
A Denver-based firm that manages a network of vetted service providers to assist with aging-care needs.
The details
Providing in-home care creates a compounding financial load that forces families to balance immediate caregiving duties with their own long-term savings goals. Because professional care requires significant capital, 25% of caregivers have already resorted to using personal savings or emergency funds. Some industry professionals are attempting to bridge this gap, such as Annalee Kruger, who created a certificate program to help advisors better understand the specific needs of clients over the age of 85.
Timeline
October 5, 2026: Northwestern Mutual released the results of its study on aging preferences.
2026: The projected annual cost for eight hours of daily in-home care is $105,120.
2056: The projected annual cost for eight hours of daily in-home care reaches $454,323.
2060: The projected annual cost for eight hours of daily in-home care reaches $552,232.
Money Landscape
This study marks a departure from the traditional retirement planning model by quantifying the immense, often unbudgeted, cost of long-term in-home care. It highlights an growing gap between personal preference for independence and the actual financial resources required to sustain aging in place.
Families should review their long-term care strategy to determine if current savings can support expected annual costs that may eventually exceed $100,000. Consult with a qualified financial professional to stress-test your retirement budget against these projected expenses.
The takeaway
The gap between the desire to age at home and the funds available to pay for it is a significant financial risk for many families. Speak with a financial professional about integrating long-term care estimates into your retirement plan to avoid relying on emergency savings.
Further reading
For more on managing costs as you age, visit our Financial Planning section.
Source note: This article includes information reported by American Banker.
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Do you feel your household is financially prepared to fund long-term in-home care?
