For working individuals supporting their aged parents, the medical expenses will require due attention, hinting at a much-needed revision in the financial planning process. To prevent a vulnerable financial situation for senior parents, in addition to an income builder plan, it is essential to look at certain financial investments that will make their life more comfortable.
Elderly parents and financial planning
The second half of life is meant for enjoying the harvest of the plant that was watered for wealth creation by opting for an income builder plan in the early phase of your career. It is, in essence, a regular income plan that acts as an income supplement to help you take care of your daily expenses when you are no longer working.
While the importance of financial planning is impressed upon us from an early age, it primarily encourages savings rather than investing in financial tools such as a regular income plan. If you are pressed for time, you can buy an online income builder plan to secure your retirement days. This will also help you compare the different regular monthly income plans in India.
Health Insurance for Aged Parents
The primary concern pressing on the mind of an individual taking care of aged parents is their health. Moreover, with uncertainties concerning health on the rise and hospital bills soaring, this factor cannot be left unchecked. In such a scenario, having comprehensive health insurance is crucial.
Therefore, even if elderly parents may be covered under the working professional’s employer’s health plan or under a family floater health insurance that would cover the medical expenses of the entire family, it is important to incorporate a separate cover that is specifically designed for aged members in the financial planning process.
A health plan for senior citizens is solely designed for individuals on the higher side of 60. Due to health-related vulnerabilities, these plans are priced higher than the usual health insurance, but the benefits associated with them can help you save a lot in the long run.
Features such as a shorter waiting period for pre-existing illnesses for the health insurance policies for senior citizens when compared to a regular health insurance policy are helpful in distressing times. However, such illnesses might include a co-payment clause.
Before buying health insurance for aged parents, it is essential to carefully examine the following:
· The health insurance policy and the associated documents need to be read carefully.
· Thoroughly acquaint yourself with the terms and conditions included in the document.
· Pay particular attention to pre and post-hospitalisation terms, exclusions, limitations, co-payment clauses, etc.
Contingency Funds to Address Emergencies for Aged Parents
To plan ahead for retirement, it is advisable to search for an online income builder to find the best regular income plan that will help you meet your expenses post-retirement. Other tools such as contingency funds are closer to our Indian understanding of managing finances – saving for a rainy day. The contingency funds are called so because they keep funds aside for emergency usage. The importance of financial planning must not be restricted to saving money in the home coffer but actively working towards building a contingency fund. It will be helpful to address sudden medical needs that might bother the elderly.
To illustrate with an example, consider that your aged parent requires a medical check-up, care of a nurse, or physiotherapy for a specified period until they recover. These costs are not covered under regular health insurance until the insured is hospitalised.
Even with hospitalisation, policy exclusions, co-payment clauses, and limited coverages for pre and post-hospitalisation, will need you to empty funds from your own wallet. Having a contingency fund in place will help you meet these unexpected expenses. Medical expenses are not the only ones pressing on with age. Having to age-proof the house to prevent medical emergencies, hiring a non-medical aid for a specific period may be needed from time to time.
Instead of letting your funds lay idle in a savings account, you can transfer them into liquid funds, which might help gain a higher return. These are low-risk funds that allow instant retrievals.
Having ‘The Talk’
There is a role reversal when it comes to managing the finances of aged parents. Those who once questioned you about adequately managing your money now need an examination of their funds. Touching upon this conversation with sensitivity is important to ensure you don’t hurt your parents. Check for the following warning signs that may mean that you need to have a money conversation with your elderly parents:
· Ask them about the phone calls they receive and check whether they are getting requests from charitable organisations or have new “friends” asking for loans.
· Check how much cash do they keep in the house. Aged parents tend to store more money at home to avoid frequenting the banks for withdrawals.
· Analyse if they have increased spending on extravagant things.
While it may be difficult to address the topic in the beginning, avoiding the conversation will only lead to the loss of finances that are needed in these crucial years of life. An easy way to help them is to encourage the use of plastic money, i.e., credit or debit cards. However, it is important to ensure they know how to use it, so strangers don’t take undue advantage of their ignorance.
Edelweiss Tokio Life Insurance Income Builder Plan comes with the dual benefit of life insurance with income generation. The income builder plan gives you the freedom to choose how to receive the sum assured. For a hassle-free experience, you can purchase the online income builder on our official website from the comfort of your home.
Life comes a full circle in providing financial assistance to aged parents. The importance of financial planning is restored at this age when additional factors need to be considered. A regular income plan can supplement daily expenses, which makes investment in them a wise decision. Although there are several regular monthly income plans in India, the best regular income plan is one that not only acts as an income supplement but also provides a life cover.
Siddhant Dubey - Writer & Photographer
Siddhant works as a freelance content writer who is interested in a wide range of spheres from photography and personal finance to cooking. He is also an aspiring photographer striving to showcase life around him through his vision.