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Why your retirement plan has to factor in the needs of your parents

People looking at early retirement must especially not to turn a blind eye to the aspect, as it can be stressful when you realise this much later in life

February 10, 2021 / 10:33 AM IST

Have you ever given a thought on the support your parents will require in their sunset years? When we discuss parents with most customers, they are prompt in letting us know that their parents are sorted and are independent.   Many of these customers are in their 40s and their parents currently live independently, sometimes with minor financial support.  When we plan for retirement, we naturally take our current situation and extrapolate it into the future. Many believe that the situation will remain the same, and at the most they would need to increase the financial support to ensure their parents are not cutting corners and are comfortable.

Planning required while bringing in an aged parent

What we have noticed over the years is something different.  With age and loss of a spouse, the surviving parent is often not able to or willing to live independently.  They will move in with their children.  In the generation gone by, this was natural progression and one would account for such things.

That is not the case with people who are in their forties.   Many of theme have lived life independently despite having a healthy and happy relationship with their parents.  They do not envisage the need for becoming the primary caregivers to ageing and, often, sick parents.

Recently we interacted with one such couple. They were planning an early retirement and things were moving along quite comfortably.  All of a sudden he lost his father; they wanted their mother to move in with them.  However practical problems started cropping up. They had two teenage children.  They had to upgrade their house to enable everyone to have more space. And this time, they were able to envisage the need a few years ahead.  Which meant that they considered a three-bedroom apartment; they wanted a servant room also to ensure that if they needed to hire help in the future to help with the care of their mother, they did not have to go through the entire exercise again.  All this meant that their cashflow went for a toss and they were unable to save as aggressively as they had planned earlier.  They have currently postponed their plans for an early retirement by a few years.


Another lady aged 70 is finding it extremely challenging to care for her 92-year-old mother-in-law who is partially blind and very frail.  She has been with them for nearly 20 years, ever since she was widowed. At 70, it is difficult to take care of oneself and the family; the additional responsibility weighs her down. Luckily, finances were never a problem.  She had therefore decided to cope with the situation by hiring a 24/7 help and has two maids who take care of the mother-in-law.  There is a tutor who comes home to ensure that the mental faculties of the mother-in-law remain intact.  She discusses topics of interest to the mother-in-law and sometimes even listens to music with her.  The charges for these services are by the hour.  Despite taking every caution possible and being surrounded by responsible house help and loving family, there are times when there is a minor fall, which leads to prolonged treatment. It has led to broken bones a couple of times, which in turn led to hospitalization.

Factoring elders’ needs in our retirement strategy

So what is the point in all of this you may ask? Well, it’s simple. While I have given you only two examples, we see such cases quite frequently.  It is important for us to factor this into our plans.  Yes, it is true that the best laid plans can go haywire, and we cannot plan for every contingency.  But caring for aging and ailing parents is more a norm than a contingency, especially given the increased life expectancy.  Look around you and you will find plenty of examples.  Apart from factoring in the funds required for their care I want to caution people who are looking at early retirement not to turn a blind eye to the aspect, as it can be stressful when you realise this much later in life.
Prathiba Girish is a Certified Financial Planner and Founder of Finwise Personal Finance Solutions
first published: Feb 10, 2021 10:33 am
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