Retirement & Financial Planning Report

Grandparents raising grandchildren are more likely than the general population to have a disability and be out of the labor force. Image: Halfpoint/Shutterstock.com

A GAO report has said that “kinship families”—where someone other than parents, often grandparents, are primarily responsible for a child’s care—face special financial stresses.

Some of the children are living with relatives or close family friends who may have become licensed foster parents but many more are living with family members without their parents outside of foster care, it said.

“This distinction is important because it can impact the level of resources and supports available to families. Kinship caregivers of children in foster care may receive ongoing financial assistance and other supports, typically after undergoing an extensive state licensing process,” it said. “These caregivers may then receive regular payments to help with the costs of the child’s care and access to Medicaid benefits, which may help pay for the child’s medical, dental, and other health needs.”

“In contrast, kinship caregivers raising children outside of foster care may be doing so with their own resources . . . Of the 16 kinship caregivers we interviewed, most said kinship families outside of foster care receive fewer resources and supports than those with children in foster care.”

Some of those challenges have “worsened since the COVID-19 pandemic, such as the cost of living and mental health issues,” it said. Special pandemic-related assistance programs have now ended; inflation in areas such as food, clothing and utilities is especially hard on older kinship caregivers who are living on fixed incomes; and mental health care needs have increased at a time of a shortage of such professionals, it said.

“Other challenges, such as the need for childcare and affordable housing, persisted,” it said, adding that grandparents raising grandchildren are more likely than the general population to have a disability and be out of the labor force.

Some kinship caregivers delay paying for other needs, such as home repairs and their own health needs, while others go back to work to help pay the costs of raising the children, it said.

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