How can planned investments help women to take care of ageing parents?

In recent years, gender issues like sexual harassment at the workplace, gender pay gap, domestic violence, the unfair burden of household chores and childcare responsibilities have received ample attention in the media and popular culture and rightfully so. However, if women were asked to point out one issue which hasn’t yet seeped into public consciousness, many would talk about the burden they have to bear as caregivers for ageing parents.

Caring for elderly parents is a time-honoured value in Indian societies and is intrinsic to the culture. Historically, caring for elderly parents in India was exclusively done by women who were not employed and whose children had grown old enough by this stage to reduce their maternal responsibilities. Prevailing stereotypes about women being cutouts for nurturing and caregiving responsibilities coupled with the gendered obligation of a woman having to entirely look after the home front, normalized men not participating in caregiving responsibilities.

 Another layer to the problem that continues to make caregiving a herculean task for women is the fact that many women, even in this age, have to unquestioningly prioritize looking after their elderly in-laws and tending to the needs of their own parents has to be relegated to the backburner. Women who have male siblings who are married have to find solace in the fact that that their brothers’ wives would adhere to this patriarchal tradition that they themselves are shackled to and take up the onus of caregiving. Even if some women are fortunate enough to bring their elderly parents to live with them for age-related health problems, it can be a challenge, especially in instances where the parents need financial assistance and the women themselves do not have an individual source of income.

Asha Agarwal (name changed), a banking professional based in Kolkata opines that for women to ensure the best possible geriatric care for their parents is an uphill task and it is seldom acknowledged. “I do not have male siblings – I have a sister who lives abroad. My mother had passed away when we were in college and my father lived alone in a different city for many years. However, after his health started deteriorating, I had to bring him here to live with me. I knew very well that I would not get much financial support from my husband because of societal conditioning in India.”

Agarwal recalls, “My father had early stage Parkinsons when he came to live with us. He needed assistance with tasks of daily living and I also had to take over planning his finances because he had started showing signs of cognitive decline too. Between my job, spending time with my husband, looking after my in laws and children, household responsibilities, it felt as if I was running relentlessly on a hamster wheel until I decided to seek help with my father’s caregiving duties. I hired two nurses to look after him and I could only afford that because I had a solid pool of investments that I had started building for this purpose as a safety net after my mother’s demise.”

A certain degree of financial preparedness can ease the journey of caregiving for women without having to rely on anyone. The need for having enough financial resources for elderly parents may be more pronounced in the case of homemakers with no individual source of income. While it is common for men in India to financially support their ageing parents, especially in joint families, pitching in for the parents of wives is uncommon. In such circumstances, having a corpus can help many women seek quality healthcare facilities for their aged parents and it also affords them the option to hire assistants for caregiving duties should they feel the need.

An often overlooked factor that has made it a pressing need for men and women to be financially prepared for taking care of their parents is the fact that investment strategies of the older generation in India have largely been confined to traditional investment avenues that were typically low risk and offered moderate returns. Now, after taking taxes and inflation into account, it is possible that those investments may not be sufficient for them to live comfortably and they may have to depend on the support of their children. In fact, many may not even have saved or invested for their post-retirement years resulting in the children having to entirely shoulder the responsibility of fulfilling their needs. A study conducted by the Reserve Bank of India in 2017 found that 77% Indians don’t save for retirement and most depend on their children.

Agarwal says seeing the results of the ultra-conservative investment approach that her father had embraced led her to the realization that the days of trying to attain financial security by investing in fixed deposits and real estate are long gone. “I have been investing in mutual funds for my goals and based on my requirements I would shift weightage between equity and debt to keep the risk factor stable. Unlike FDs and other fixed income investments, mutual funds offer better inflation-adjusted returns. And unlike real estate or gold or FDs liquidity is not at all a concern,” she says.

Anant Ladha founder of Invest Aaj for Kal says, “Mutual fund is an investment option which allows you to invest in almost all asset classes. Women who do not have an individual source of income can benefit from mutual funds in multiple ways – debt fund investments offer higher post-tax returns than fixed deposits. Furthermore, they can also regularly put money as and when they get it in liquid funds which can be used as ‘parking funds’ in this case as and do an STP into equity mutual funds. STP (Systematic transfer plan) is a beautiful way to plan investments for those without a regular source of income. Also, if financial health is an issue, more weightage can be given to debt funds over equities. Women with no or limited income should not go equity heavy.”

Key takeaways

• Take stock of the nitty gritty of your elderly parents’ financials from time to time to avoid being thrown into the deep end in case of an emergency.
• A certain degree of financial preparedness can ease the journey of caregiving for women without having to rely on anyone. The need for having enough financial resources for elderly parents may be more pronounced in the case of homemakers with no individual source of income.
• Mutual fund is an investment option which allows you to invest in almost all asset classes. Women who do not have an individual source of income can benefit from mutual funds in multiple ways – debt fund investments offer higher post-tax returns than fixed deposits.

Disclaimer: This article is part of the HT Friday Finance series published in association with Aditya Birla Sun Life Mutual Fund.