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Parenting your Parents – The Financial way!

You read it right. You are grown up now, working, settled, enjoying & managing your own life and finances. Hold on.. Have you thought about your parents? Are they settled financially or are they still trying to manage their finances for the rest of their life, to be precise,  their daily expenses!

People are now more aware of the financial market as compared to the earlier times. We have lots of investment options available now; and people are more comfortable to invest in shares, stocks, mutual-funds than rudimentary options like bank deposits, postal schemes, etc. Things are quite easy and accessible due to internet. We are all busy working on making our “future” successful. But at the same time, our parents are also thinking of making a retirement decision. Isn’t it?

Retirement age is fixed but life span has increased, health is improving due to advancements and research in medical science; however on the contrary with decrease in interest rates on fixed assets/investments and increase in inflation it is affecting the value of basic necessities. These current economic factors are forcing senior citizens to re-plan, in terms of finances, for the rest of their lives.

After doing so much of hard work for years, many of them are still worried about their finances, which is very painful. But you can help your parents to manage it and make their lives easy and peaceful as you have a very important factor with you – “trust!“.

Following are some guiding points that will help you on this:

  1. Don’t criticize your parents for the investment decisions they made earlier. Making investment decisions and its execution is not easy, and has not been easy even at their So,respect it.
  2. Help them to make a list of all their bank accounts, deposit certificates, insurance policies and other investments with all the important details such as bank name, account numbers, insurance policy numbers, etc to name a few. Since elderly parents usually forget about the maturity dates for deposit certificates/insurance policies etc, they might need help with this.
  3. If your parents had taken any loan for education/marriage or are using credit card, then check the remaining balance due on it and suggest them to pay it off as early as possible. It may directly affect their Be aware of your parents debts, so that you can manage it in case of any unfortunate event.
  4. The crux of investments in retirement planning is capital protection with regular investment, growth is a needed factor too. And hence your parents can invest some part of their savings in shares or mutual funds like market-linked debt products of mutual funds for additional regular income.
  5. In case your parents are going to get a decent sum of money on their retirement/or received fund which they have accumulated over the long years, am sure lot of agents/advisors will try to approach with bundle of plans just for sake of bigger commission. Help your parents to get a proper retirement plan from a well-know/trusted advisor whom you know.
  6. If your parents want to purchase annuity insurance plans for regular income, after retirement contact a well-known and trusted broker. It’s advisable not to invest in any annuity plan without understanding the policy and its terms and conditions.
  7. In India, lots of parents move to their son/daughter or relatives place after retirement or due to any unavoidable  Insuch cases, it may be difficult for them to move or get adjust to city as they might have all their investments and bank accounts in their home town. So change in communication address is an important step. Payment of company sponsored Retirement benefits such as insurance policies claims, pensions or dividend may make an issue in such cases.
  8. Reverse mortgage is one more available option for regular income, which is not so popular in India but is only advisable in certain conditions as it may be expensive. In India, old people are generally very attached to their home.
  9. There are people who love to continue working or miss their workplace, friends and their familiar settings and if your parent is one among them, then encourage them to do a part time job which not only adds to their income but is also a great way to learn, enjoy and make new connections.
  10. Convince your parents on direct deposits of payment like pension/annuities, dividends options as it is the safest Most elderly people in India still prefer the checks.
  11. In case your parents want to establish their own business, help them to find a good lender/bank. Remember senior citizens can get loan at low interest rates.

The above points are just for guidance and may assist you to help your parents take the right direction and will also help to build their trust and spend the rest of life worry free. Remember, your parents are done with their responsibilities now it’s your turn!!



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Protecting your parents money: Jeff D.Opdyke

Author: Gayatri Jagdale

Gayatri Jagdale lives in Raleigh-Durham, North Carolina Area. She is a Financial/Investment Advisor and Blogger. She has years of experience working in the Financial Services Industry. She also blogs to bring financial awareness and literacy specially in women in India. To learn more about her, visit her website Fund-Matters Contact info: [email protected]m

2 thoughts on “Parenting your Parents – The Financial way!

  1. Hi Gayatri,

    First of all, I want to compliment you on the great article and for putting all tips in one place!

    I was curious about option 8. My parents have property in Mumbai. And reverse mortgage is an option they are looking at. Under what circumstances should we consider?

    At present they are self sufficient. I have life insurance in my mother’s name, an NRE account with mom as a power of attorney and an emergency fund here. Is there anything I am missing for the time being?

    When is a good time to step in and help parents with their finances? They are set in their ways and its working well so far. I know its not now

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