How to ensure the financial safety of your ageing parents

Rajpoot works in a metro. He is worried about his elderly parents who live on their own in his hometown. While he respects their wish to be independent, he cannot help but fret about the threat of robbers targetting senior citizens living alone. Like all senior citizens, his parents too are vulnerable to such attacks. He is aware that they keep large amounts of cash and jewellery at home for emergencies. Rajpoot wonders what steps he should take to make the lives of his parents more secure.

A senior citizen’s need to keep cash at home stems from the fear that they may not have sufficient funds in case of an emergency. At their age, Rajpoot’s parents’ biggest fear would be a medical emergency. He should consider enrolling his parents in a cashless health insurance plan which would cover at least their emergency medical expenses. He should add them to his health policy if procuring an independent policy proves difficult. He will need to explain the process of using the facilities under the policy so that his parents become confident of managing their needs without holding a large amount of cash. There are some tax benefits also available for senior citizen parents’ medical insurance under Section 80G.

A credit or debit card or a mobile wallet is another convenience that can eliminate the need for cash. Digital payments are widely accepted, including in medical and grocery shops. Rajpoot should encourage his parents to use the same and provide assistance in whatever way possible. The payment of credit card bills could be handled by him through Internet banking. Jewellery, except what is needed for regular wear, must be stored away in a bank locker.

By taking all these measures, Rajpoot’s parents’ dependence on cash will be minimised, while ensuring liquidity. This will allow them to lead an independent life without having to worry about safety.

Content courtesy: Centre for Investment Education and Learning (CIEL).
Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.