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Raising Grandchildren Can Lead to Financial Challenges
Increasing numbers of grandparents are becoming primary caregivers to their grandchildren, a new role. Many have found raising grandchildren can lead to financial challenges.
Don’t Take On New Debt
Because many grandparents are in their 50s or older, it’s important to avoid taking on new, large debts or willingly sacrificing retirement savings plans—there’s not enough time to recover from major financial setbacks. Legal fees, child care costs, and housing demands can be overwhelming. To make ends meet and stay on track, experts urge custodial grandparents to accept assistance if it’s available.
Programs That Can Help
Assistance can come in many forms—grants, child care, and food stamps are a few of the ways government and private programs help custodial grandparents. Exactly what grand-families will qualify for depends mainly on:
* The form of custody arrangement
* Income and assets
* The state of residence
Tax Breaks?
A number of tax breaks also can leave more money in caregivers’ pockets. To claim most tax benefits, grandparents must qualify under Internal Revenue Service (IRS) rules. That generally requires that grandparents and grandchildren meet the definitions of a primary caregiver and a dependent, neither your income nor the children’s exceeds the limits, and no one else comes forward claiming the child as a dependent.
Check the IRS website at irs.gov for information about items that can help such as the Child Tax Credit, Dependent Exemption, Earned Income Credit, Child and Dependent Care Credit, Change in Filing Status, and tax breaks for education.
Taking steps to reduce money-related stress can allow grandparents to savor their new role as caregiver, even if raising a second family was never part of their original retirement plan.
To Avoid Scammers Be Wary of the Phone
While scams keep changing, the targets stay the same. Seniors continue to be the marks of a variety of low-risk crimes that prey on their sense of duty and exploit their fear of cognitive loss. We advise seniors, to avoid scammers, be wary of the phone.
FTC Data Tells The Story
The Federal Trade Commission’s Bureau of Consumer Protection logged 1.5 million consumer fraud complaints in 2018, with over $1.6 billion lost; Consumers who said they were 60 and older (older adults) filed 256,404 fraud reports with reported losses of nearly $400 million.
Retirees make ripe targets because they have access to cash via retirement savings and equity in their homes.
What To Do
Here is what to do to avoid being targeted:
- Ditch the landline. Phone scams continue to be a tremendous problem for consumers of all ages. Older adults reported that a phone call was the initial contact method in numbers four times higher than all other contact methods combined. One reason seniors are targeted is because they still use landlines—so they’re easy to find through commercially sold phone lists—and they often answer their phones.
- Sign up for AARP’s Fraud Watch Network alerts and check its online map. This will help you keep up-to-date on the scams happening where you live, as scammers frequently change the areas they’re targeting.
Aging Fraud Hotline
- Call the U.S. Senate Special Committee on Aging Fraud Hotline. If you suspect someone is a victim of fraud, call the hotline (855-303-9470) where fraud investigators can offer advice about how to proceed.
- Hang up. Whether it’s a purported relative imploring you to send money right away or a sweepstakes requiring you to pay taxes in advance—two common scams—say you’ll call back. Then research the situation. If the caller is putting pressure on you to pay immediately, it’s a scam.
- Frequently check the Security and Fraud Center at MidOregon.com. This gives you up-to-date articles about the latest in scams and prevention, and well as a tips and articles about becoming and staying safe and secure.
Pay it Forward: Alyce Hatch Center
Roger Singer, board member of the Alyce Hatch Center in Bend, along with a few other board members, nominated the center to be November’s Pay it Forward winner. KTVZ surprised them Wednesday with $500, courtesy of Mid Oregon Credit Union and CoEnergy Propane.
Jennifer Faircloth, an occupational therapist at the center, said they will use the $500 to buy a second “squeeze machine” for the center’s La Pine location. The machine acts like a massage, with the ultimate goal of making kids who don’t like human touch react more positively to it.
Every day, about 350 kids with developmental delays, from newborn to age 5, come to the Alice Hatch Center to learn, in the hope they’ll develop the tools they need to thrive in a traditional classroom.
KTVZ Pay It Forward information
KTVZ Pay It Forward Nominating Form
To see more Pay It Forward stories, click here.