Many people does not realise it, but taking care of parents is a practical issue for most of us in terms of financial commitment. If all things goes as normal, ie your parents take decent care of you and supported you to your adulthood, we are expected to repay this debt in the name of either love and/or filial piety. Yet for our generation, most of our parents do not know how to manage their finances. Many of them at best could only do one thing – save.
They worked, they paid for the expenses, and with what was left they saved their money. Bit by bit, over the years. Yet we know that simply saving money would cause us to lose to inflation. Of course, at least they are better than many of our generation – having the knowledge to invest but still get into debt for all sorts of stupid reasons – eg fanciful shoes, big cars, pretty houses etc.
Our parents will get old and sick one day. They may have or not have any savings. Yet hospital bills are expensive and medicines are not cheap. We do not wish to come to a point where we have to stop the treatment simply because we have wiped out our savings. Practically speaking, we still have a future to live in, and we also do not wish to cut short their lives because we have run out of options. So what can we do?
This post will attempt to give some practical suggestions to people whose parents have little or no savings, and will have to fully depend on you when the time comes.
Savings and Investments
We can save for them, and do simple investments for them. $300 a month may not seem much, yet is also a portion of most of our salary. $300 a month = $3600 a year = $36,000 over 10 years. As always, it is best we save as early as we can. But even if it is late, better late than never. Tweak the $300 figure accordingly to your needs and capability, as well as the age of your parents. The older they are, the nearer it is to the date when they will need the sum of money.
As for investment wise, do not go for high risk investment. Go for low risk portfolios. If you ask me, perhaps just outrunning inflation is sufficient.
The purpose of this section is to mainly cover living expenses. Older people do not need much to live on. They do not eat much, and many has lost the desire for fanciful items. While there may also be other bigger expenditures in the form of medical bills, we will attempt to cover them in the following paragraphs.
There are many kinds of insurance, but the most important insurance for your parents will be the hospital insurance. Unless you have Government welfare like that of New Zealand or Canada where your hospital bill is fully paid for by the Government, hospital insurance is something you definitely need. Most hospital insurance will cover a bulk of the hospital bill for you. In certain premium hospital insurance policies, they will cover the whole hospital bill for you, at an additional annual cost. Naturally, as one grows older, the more expensive the annual premiums will cost.
That being said, I believe everyone should know how much is a hospital bill in their own respective country. In Singapore, a heart bypass in the Government hospital will cost $20,000. In the US, I believe I need not explain further the exorbitant fees over there. Staying in a hospital one time will easily cover back a few years of insurance premium which you have bought. It does not take a genius to work out the mathematics behind it. Look at the available insurance policies, the premiums of each policy and what they cover. Then decide what you want. Buy it not only for your parents, but also for yourself and your family. The thing about hospital insurance is, they do not cover existing illnesses and conditions. So buy it and seal the deal when you are healthy and have everything covered.
Sacrifice a small portion of your income every year to protect the rest of your savings. You do not wish to spent 20 years of savings on hospital bills when you can sacrifice a little portion annually and sleep in peace, knowing you are protected.
Note: I am only referring specifically to hospitalisation insurance. At this point I do not recommend any other type of insurance. I will see if I can write something on the topic of insurance in the future.
Healthy living will not stop death, but it does certainly helps to prevent certain unnecessary illness. Eating healthy, regular exercise and regular work will help the body and the mind to keep in shape. Work in this case here does not necessarily mean getting a job outside, but physical and mental activities that keep your body up to standard. It can include farming, gardening, working on house’s mini projects such as painting etc. Find something to do and get the exercise required concurrently.
Go for daily strolls, leisure bicycle rides. Go out of the house and be with nature, for humans are originally meant to be in one with nature. Have a social life – play some chess with friends, go out fishing with a buddy. Do not stay at home whole day to watch TV or waste their lives away everyday meaninglessly. The value of a year at the age of 20 is different from a year at the age of 80, but it does not mean that time at the age of 80 is useless. I have seen older people being active in the church and in the community, doing something they believe is of value.
At that age, the mere ability of the parents to take care of themselves is a great help. We do not expect them to give us $100,000 of their savings. Them being healthy means financially and emotionally, in terms of time and energy, we are spared a great deal of trouble.
Annual Medical Checkup
Annual checkups is necessary if you are above 50. I do annual checkups myself. Many times, sickness takes time to develop. Your heart arteries do not get choked overnight. Your tumour does not grow overnight too. Do annual checkups, get tested for any potential illness. If there are big illnesses, getting discovered early and seeking the proper treatment does save you a lot in terms of money, time, energy and may even save their lives.
Even if no big illnesses are discovered, the small problems of the body like high blood pressure, high cholesterol can also be detected early. With the medical report on hand, the doctor is able to give advice on what can be improved and what to look out for. This ties back to the ‘Healthy Living’ paragraph above. In the ideal condition where the body is all good, at least you can sleep peacefully at night knowing as at this moment, no medical illness is plaguing anyone in the family.
One day we will all fall sick. The time comes to us all. Yet not all sickness requires you to stay in hospital 24/7. One good example is cancer. You do not need to stay in hospital all the time. You do your chemotherapy, you go home and eat all that expensive medicines the doctor prescribe you. Medicines are unlikely to be covered by the hospital plan. But you still need them. I am going to give a suggestion, but you have to decide this for yourself. I take no responsibility for this advice.
I have seen many people buying medicine from India. India is the world’s largest medicine factory. Many of them replicate the medicines of all sorts of illness – from Parkinson’s disease to HIV to cancer. Whatever medicine you need, India is sure to have it. Pirated medicines, if you will.
Medicines are expensive because of the sheer cost and time taken to research, develop, test and get approval for the drug. The cost of manufacturing itself is very cheap, and the ingredients that goes into a medicine is largely known. I have heard that in order to prevent copyright issues, some Indian pharmaceutical companies may just change 1% of their content.
Objectively speaking, between wiping out your savings and getting an original medicine, getting a pirated medicine at a fraction of the cost is certainly more logical and practical. To add to this, India does not seem to have a bad reputation for the medicine it produces. For the world’s biggest medicine factory, there has to be a decent quality to its medicines for it to reach that level. It does not get to be the world’s biggest factory if no one buy its medicine. We can therefore deduce by logic that its huge demand means that the medicine works.
The above few points are not exhaustive, but it is something which we all can consider and start taking action on.