The best gifts for your mum on Mother’s Day

According to Securenow.com, the annual premium for a health insurance costs about Rs 35,000 – 48,000 for a cover of about Rs 5-6 lakh for a 70-year old woman in Mumbai. A 30-year old male, on the other hand, would need to pay a premium of just about Rs 5,000 – 8,000 annually. That’s how expensive health insurance gets with age.

“At that age with limited or no income, it’s not feasible for your mother to buy a health insurance. Besides, in India, we still have a huge non-working women population who are or have been dependent on their husbands financially,” says Khyati Mashru, founder and chief financial coach, Plantrich Consultancy LLP. Mashru recommends a top-up insurance policy, if the base health insurance comes too expensive. A top-up policy comes with a deductible. In other words, it mandates the policyholder to pay a certain amount (called the deductible) and then the policy reimburses your medical bills over the deductible amount.

Top-up policies are independent health insurance policies whose premiums are lower than base health insurance policies because they come with a deductible. That way, in the case of hospitalisation, either you or your mother can bear the expenses up to the deductible limit and then the health insurance (top-up) policy kicks in.

“There is tax deduction tax benefits to be had for paying health insurance premiums of a senior citizen parent”, adds Mashru. For premiums paid towards your parents' health insurance, you can claim an income-tax deduction of up to Rs 25,000 paid as insurance premiums. But if your mother is a senior citizen, health insurance premiums paid up to Rs 50,000 gets you income-tax deduction. In other words, your total taxable salary comes down by Rs 50,000.

Financial check-up

What about your mother’s finances? Who handles them? If she lives on her own or in some other town, and manages her own finances, then gift her a financial plan consultation with a good financial planner or an investment advisor. Financial planners may or may not charge a fee. If they do charge a fee, then there are chances that the advisor may be registered with the capital markets regulator. A typical top financial planner charges between Rs 5,000 – 50,000 for a one-time consultation fee. “The fees are wide. It also depends on the quality, reputation and standing of the financial planner because top financial planners get give you exhaustive financial advice that is very useful to be on top of your finances”, says Sadique Neelgund, founder of Network FP, a platform that helps financial planners build their businesses.

Your planner would sit with your mother and understand her income, expenses, financial goals, what she would like to with her money, help her or guide her about dud investments she ought to get rid of, new investments that she could consider, and so on. “Your mom may also have questions on how to make a will (if she hasn’t already made one), how to divide her assets between her children. She may not be comfortable in talking about all this to her kids, but she could feel more comfortable with a financial planner”, says Nisreen Mamaji, a Mumbai-based certified financial planner, and founder, Moneyworks Financial Advisors.
Additionally, Mamaji says you could help her sort out her household finances and investments yourself, if you haven’t done it so far. Taking an inventory of her investments and her bank accounts and making a list (like in a Microsoft Excel sheet), making her aware of her passwords and perhaps making a safe list for her so she can refer to it later if she forgets…all these require time and effort, Mamaji adds. “For which, your mother may have not done all this so far, but you can gift her the gift of your time and sorting it all out for her”, she says.

Health check-up

It’s always better to be safe than sorry. And that is what health check-ups are meant for. Most leading hospitals offer comprehensive health check-up plans where people can go and avail of them. Doctors, typically, recommend a complete check-up atleast once in two years if you are below the age of 40. And an annual check-up if you are older than 40; which is the age most of our mothers are. But health check-ups don’t come cheap. For instance, Breach Candy hospital, a leading hospital in South Mumbai seven health packages that range from Rs 5,000 to Rs 36,000, with two of these plans specifically curated for women. “These are preventive health check-ups. To do our annual check-ups and make them our routine is a good habit that more and more people, increasingly, are warming up to”, says Mashru.
Plus, there’s a tax incentive here as well. You can claim income – tax deduction under Section 80D up to Rs 5,000 for your annual preventive health check-up. But this limit is subsumed within the overall limit of Rs 25,000 (and Rs 50,000 for your senior citizen parents). So if your mother is a senior citizen, you can get the tax deduction benefit for preventive health check-up for your mother, as well, in addition to your own health checkup tax benefit.

Liquid fund

Apart from a health insurance plan, the foundation of a good financial plan also rests on contingency fund. At MoneyControl, we always recommend you to have a contingency fund. Gifting your mother her very own contingency fund is also a good idea.

Priya Sunder, director, PeakAlpha Investment Services says: “This could be a completely new source of income for your mom. She could use this money for her small, discretionary expenses, without disturbing her bank balance. A systematic investment plan (SIP) of Rs 2,000 into a liquid fund is a good gift.”

Start an SIP into a liquid fund and a bank account, both in ‘either or survivor’ mode (joint holding) so that your mother can also withdraw from the liquid fund and bank account whenever she wishes.

For sure, don’t forget that special lunch or dinner with your mother. Go ahead and treat her. But take care of her health and finances. Happy Mother’s Day!