Here are some important financial tips to keep in mind when caring for a loved one:
- If you are the power of attorney for property for your loved one’s finances, keep in mind that the money is to be spent on your loved one’s needs, not your own. Keep careful records of how you are spending the money.
- There might be some financial assistance available if your loved one meets certain criteria. For example, the disability tax credit (DTC) assists people with disabilities or the people supporting them by reducing how much income tax they pay. This tax credit is not refundable. Learn more about the DTC and eligibility.
- Registered disability savings plans (RDSPs) help parents and others save for the future financial needs of a person who is eligible for the disability tax credit. Contributions to an RDSP are not tax-deductible but there is no tax on income and capital gains in the plan until the money is withdrawn. Learn more about RDSPs.
- Some provinces or municipalities offer grant programs to help with updating homes for accessibility purposes. Find out what is available in your area.
- You might be eligible to claim a tax credit for a caregiver. Learn more from the Canada Revenue Agency about credits and deductions and speak to a tax professional for more information.
Depending on the situation, caring for your loved one could have an impact on your income and your ability to spend or save money. Check your budget regularly and tighten your spending habits if necessary. If your financial situation has been affected, check in with your advisor to update your investment plans.