Provision For Old Age

[krish44]

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There is a chinese proverb-

If your children are lazy, they do not deserve your inheritance.

If they are hard workers, they do not need it.

So use it ,fellow senior citizens to provide yourself with the deserved pleasures of old age.

I could relate and subscribe to this point of view.

Many times I wonder why many senior citizens with piled up money act miserly and not spend on themselves for a better life.

The hurtful part is they try to make the next generation also to be like themselves and hoard their money.

The most sinful act is parking all their wealth in Gold[dead assets] or fixed savings instruments with meager interest making it a depreciating asset and spread

misery all around them with a poor lifestyle and forcing others in the family to do the same.

Senior citizen can plan their life, appreciate their assets and also splurge on themselves with a little bit of liberal thinking.

There is nothing holy in living like a miser and subject oneself to unwarranted hardships

 

[mkrishna100]

The most sinful act is parking all their wealth in Gold[dead assets] or fixed savings instruments with meager interest making it a depreciating asset and spread

misery all around them with a poor lifestyle and forcing others in the family to do the same.

A few relatives in my family are like this .They have enough money and proeprties and their children are well off but even at Old Age they fear spending well for themselves .

 

[renuka]

Dear Krish ji,

It is not that a person does not want to spend but sometime one might wonder "what to buy?"

When I go shopping..my first priority is spending money on good food which is organic food that cost more.

Then my 2nd priority is books and fitness magazines.

Then for other items I buy what I need and not just merely spend for nothing at all.

I dont like to upgrade to any latest electronic gadget just becos its the new trend..till the old one is functioning I usually do not upgrade.

I am not fond of holidays unless its a trip to India to buy books..that too I just buy my books and some minor shopping and fly back. I am not really the travelling kind and I feel holidays tend to actually make a person more stressed up becos there is change in the usual daily pattern. I am not a fan for change...and in holidays you do not get to be yourself..you have to adjust to everyone elses need becos holidays means a family outing and the more the people the more the adjustments.

BTW its not that I do not want to spend money..its just that I do not find acute reasons to spend.

So automatically the less spending translates into more savings.

So frankly speaking I do not think everyone is afraid to spend its just that sometimes there are no reasons to spend.

 

[V.Balasubramani]

So frankly speaking I do not think everyone is afraid to spend its just that sometimes there are no reasons to spend.

Doctor Mam,

You are right.

When age grows energy diminishes.

They do have their own priority. With cost of medicines shooting up every day, it is always better to have a reserve fund to meet the unforeseen medical expenses.

In lot of houses, the bath room appears to the most 'accident prone' spot for seniors.

It is wise to spend money reasonably and to have a reserve fund so that you need not depend upon any one else even on one's own kith and kin.

Feeling economically independent is great for senior citizens.

As such, it is better to spend with an eye on economy instead of proving a spendthrift and suffer as a fish out of water on rainy days. (Leave alone the Insurance package and the benefits of medical aid/assistance, etc)

I have seen some senior citizens going on ‘pilgrimage’ and spend money to fulfill their long pending desires and there are some who spend money on books for the pleasure of reading. There are rich families who lead a very simple life, spend time watching TV serials, go to temple, read weekly magazines, chat with friends on cell phone, etc. and thus avoid unnecessary expenditures. And some take the car, go for a picnic to hill stations and other nice tourist spots and do enjoy their life. This happens around me.

My wife attends Veena class. Carnatic music class, Bhajan, Vishnu Sahasranama Mandali, Soundarya Lahari course, etc and spend money liberally on books and other related items and thus learning new things which is her passion.

 

[renuka]

Doctor Mam,

You are right.

When age grows energy diminishes.

They do have their own priority. With cost of medicines shooting up every day, it is always better to have a reserve fund to meet the unforeseen medical expenses.

In lot of houses, the bath room appears to the most 'accident prone' spot for seniors.

It is wise to spend money reasonably and to have a reserve fund so that you need not depend upon any one else even on one's own kith and kin.

Feeling economically independent is great for senior citizens.

As such, it is better to spend with an eye on economy instead of proving a spendthrift and suffer as a fish out of water on rainy days. (Leave alone the Insurance package and the benefits of medical aid/assistance, etc)

I have seen some senior citizens going on ‘pilgrimage’ and spend money to fulfill their long pending desires and there are some who spend money on books for the pleasure of reading. There are rich families who lead a very simple life, spend time watching TV serials, go to temple, read weekly magazines, chat with friends on cell phone, etc. and thus avoid unnecessary expenditures. But, instead take the ca,r go for a picnic to hill stations and other nice tourist spots and do enjoy their life. This happens around me.

My wife attends Veena class. Carnatic music class, Bhajan, Vishnu Sahasranama Mandali, Soundarya Lahari course, etc and spend money liberally on books and other related items and thus learning new things which is her passion.

Dear Bala sir,

You are right...health is something where one has to make sure money is available.

I do not fully rely on Insurance cos I know how Insurance policies work...some of the policies actually put a strain on the doctor to not exceed too much so the doctor feels restricted to run all tests.

That is why sometimes I prefer using cash for certain treatment becos then the doctor is free to treat.

So this is where cash comes in handy..for that one needs to have a good saving.

I know people who had delayed their treatment becos their insurance policy needed 1 month more to give full coverage.

They were not willing to use cash meanwhile.

People get their priorities wrong when it comes to money and end up spending money for all the wrong reasons and not have money for the right reasons.

I see even people who earn very little spend money on the latest smart phones just to keep with with the trend.

They do not want to buy what they can afford.

For many people life is about showing off to others ..so they do not mind spending to show off.

Sometimes when I go for medical meetings..at times the female docs brag to each other that " I went to Paris for holiday..I am planning to go to UK next month..what about you?"

Then I say "I am not really into holidays" and they will reply "OMG ! I would be dead if I did not travel abroad to Europe etc"

So many people feel shy when others say this and travel just to show to others or just to upload some pic on their facebook!LOL

If life is all about keeping up with the Kardashians..money will never be enough.

 

[prasad1]

Sometimes you do not know how much time you have in retirement. So you need to plan your savings to last as long as possible. It is still possible that by some misfortune your money may run out before you do.

So it is not wise to spend all your savings. If your calculations are wrong you might leave an inheritance for your children. I agree that we need not save for our children.

 

[renuka]

. I agree that we need not save for our children.

???? really?

Just say if the child scored good marks but could not get the course of his choice in a government university becos of stiff competition..if we had saved money for him we can send him to another country for studies or send him to a private university where he can get to do the course he desires.

This is where savings come in handy.

BTW who does not save for children..the only reason I bought and invested in property is becos I have a child.

If I were single and not married I would not have invested so much in property.

It is better to buy property for children so that it saves them the trouble of urgently buying houses later and they can concentrate on their careers more and the pre existing property would be generating income becos of the rental acquired. Then when they are more stable they too can add on and buy new property for themselves.

I have seen many people who claim that they do not save for their kids..but they do not mean it..they keep telling this to others so that others do not save up for their kids but they secretly save up for their kids.

I dont know about you Prasad ji...you could be telling the truth that you do not believe in saving for kids but as far as I know 99.999999999999999% of people who claim they do not save for their kids are liars!

 

[krish44]

Again I would like to draw attention to the last two lines of my lst post.

My point is most senior citizen do not do proper finance planning. They invest all their money in dead or low return intrument depreciating their assets.

If renukaji has invested in property - perhaps for her next generation , it is wise as property is an appreciating capital asset. it is sensible to invest atleast 30 percent

of holdings in investment with higher returns such as property or shares etc.at least 10 percent could be for a better life style for senior citizen. what is their personal

choice for spending could be different.when we are in high inflation economy at 11 percent it is stupid to have deposit at 9 or 10 percent as the real interest in near

zero.Most live on interest further depreciating their worth.

I had a relative who insured himself for enormous amounts and lived very badly all his life paying huge premium on small govt salary . Often he did not enough money

for monthly house hold expenses. He even borrowed money for his parent funeral expenses. He was in a senior govt job with fairly decent salary . He had a phobia

about old age and was miserly in spending . He would save on busfares walking instead, manage with only 2or3 setsof dresses . hw would not go to doctor to save on

medical bills. just screwed up finance planning. He had a huge pile of money after retirement to which he clung to which his son in law is happily blowing up after his

passing away.there are many who are stingy to various degrees. they would like everything free or as a dole from some agency or other.they would get food from

ration shops to which they are not entitled and also collect freebies like TV or fans on ration cards for the poor. I found some affluent people enjoying the freebies of

tamilnadu govt for the poor.

Miserliness is mental make up . Those of the fifties and sixties era have seen the shortages of socialist era and cannot accept that things have changed and it is not

wrong to live well and provide comfort for themselves.the worst part is forcing this mindset on children and make them lead a double life of deceit of poverty home

and splurging on the sly.lol

 

[V.Balasubramani]

It is thought or I would say the greed that has driven more investors of Tamil Nadu hoping for lucrative return to deposit their lifetime hard earned money with unregistered Chit Companies and later got cheated.

Since there were lot of complaints from general public, the Government of Tamil Nadu enacted a law TNPID Act (Tamil Nadu Protection of Interests of Depositors (In Financial Establishment Act) 1997 providing action against the cheating unregistered Chit companies/ Financial Institution by the Economic Offences Wing of Tamil Nadu Police.

Similarly, the Gold Coin Scheme, Resorts Scheme, Multi Level Marketing scheme,Emu Bird Scheme, etc promised high return and swindled the lifetime hard earned money of the gullible public.

As for investing in stocks and shares which is considered nothing but a gamble, also requires some minimum knowledge on this particular field for a layman

I like to share the following link in this regard.

Be wary of investment schemes with very high returns - Money Today

It is better always to go by the proverb ‘A dove in the hand is better than two in the bush’ and lead a self contented life instead a longing for high return and fall prey to fraud companies and ultimately end up as a pauper.

P.S: 'A known devil is better than an unknown angel'.

 

[krish44]

See it is this perceived sense of insecurity and total lack of faith in everything and every one that makes people risk averse and they end up playing over safe.


OK what happens if banks Fail . sometimes it happens .

Simlarly if pension fund invest in stock market and lose heavily ., what could be the consequences?

One can always imagine all kinds of scenarios and become more and more protective about money .

In modern days no money instrument is risk free .

Even currency can be devalued making your money worth less

So no sense over doing it and not make good financial decisions

 

[prasad1]

???? really?

Just say if the child scored good marks but could not get the course of his choice in a government university becos of stiff competition..if we had saved money for him we can send him to another country for studies or send him to a private university where he can get to do the course he desires.

This is where savings come in handy.

BTW who does not save for children..the only reason I bought and invested in property is becos I have a child.

If I were single and not married I would not have invested so much in property.

It is better to buy property for children so that it saves them the trouble of urgently buying houses later and they can concentrate on their careers more and the pre existing property would be generating income becos of the rental acquired. Then when they are more stable they too can add on and buy new property for themselves.

I have seen many people who claim that they do not save for their kids..but they do not mean it..they keep telling this to others so that others do not save up for their kids but they secretly save up for their kids.

I dont know about you Prasad ji...you could be telling the truth that you do not believe in saving for kids but as far as I know 99.999999999999999% of people who claim they do not save for their kids are liars!

Renekaji hold a minute, before you start calling me names.
The original post of Krishji said:

If your children are lazy, they do not deserve your inheritance.


If they are hard workers, they do not need it.


So use it ,fellow senior citizens to provide yourself with the deserved pleasures of old age.

I agree with it. My child would not refuse the money in inheritance, but she does not need it. I have friends of similar age and their adult children are in similar situation. You are young and your child still needs your money, not every child is in similar situation.

So before jumping to wrong conclusion reassess your and my situation it is different. Like you need to have life insurance, as loss of your income will impact your family. Nothing of that sort is needed in my case. Age matters.

 

[V.Balasubramani]

See it is this perceived sense of insecurity and total lack of faith in everything and every one that makes people risk averse and they end up playing over safe.


OK what happens if banks Fail . sometimes it happens .

Simlarly if pension fund invest in stock market and lose heavily ., what could be the consequences?

One can always imagine all kinds of scenarios and become more and more protective about money .

In modern days no money instrument is risk free .

Even currency can be devalued making your money worth less

So no sense over doing it and not make good financial decisions

What has been mentioned in my post are not certainly imagination.

Lot of public were cheated, crores of money swindled, Number of cases have been booked and being investigated. One can very well get the data from the Economic Offences Wing of Chennai Police.

And in some of the cases the properties of the companies are sold and only a very meager amount is returned to the Investors. Poor guys paying penalty now for having taken the risk earlier.

One should learn lessons from such incidences and play the game safely.

If it is ill gotten money, I think one can very well take such risk in my opinion. Not certainly hard earned money especially at the rainy days, I mean fag end of the life.

Youngsters can do business taking risk and can always switch over to other line, if not successful. Because they need to do that for survival.

But not for seniors who are supposed to lead a relaxed and leisurely life.

It is the perceived sense of prospective return and high expectations that lands the seniors in trouble.

One can always keep away from such crazy race of mad mad world and try enjoy the peace of life and bliss.

 

[sangom]

Some senior citizens who have no pension from their lifelong job, some others who think they can make windfall profits from the stock market and yet others who get a lot of moneys from their well-employed children (in India/abroad) usually discourage bank fixed deposits and carry on a virtual promotion of the share market investments as the sign of a person who is representative of the modern age, young at heart though old in body, etc.

I have made only one share investment in my life and that was a disaster which cost me the fabulous(?) (to me) loss of the princely sum of ₹1,000/= way back in the 1970's. But I have closely observed the working of the share market for a long time. The best epitaph for stock-/share- market is what the famous Galbraith reportedly said, viz., that people expect the share market, which is really a harlot, to behave like a chaste woman (or something to this effect). I also know some people closely who lose valuable money in the share market, regularly but will only tom tom their 'big catches' off and on, when you talk to them. Most of them lose their peace of mind and have a heart by-pass invariably. Thus comes to a close, most of the stories of senior citizens who wisely make provision for their old age.

My only doubt is, if Shri Krish sir has been making provision for his old age in really appreciating assets, etc., why is he so particular that some others should not lead peaceful lives within their limited incomes?

 

[renuka]

Renekaji hold a minute, before you start calling me names.
.

That is why I said that you could be telling the truth and I was right.
Thanks

 

[renuka]

Like you need to have life insurance, as loss of your income will impact your family..

Yup you are right...I took a life insurance at the age of 25 and I have made a will and have named the beneficiaries.
All done.So if I drop dead no one is left in the lurch.

 

[Jaykay767]

Agree with Balasubramani here !One should NOT invest & take risks in old age, there is NO way to recover from disasters. So they should keep all the money saved so far in Bank FD’s & live on the interest. And they should adjust their living based on the interest income. On the other hand youngsters should invest & take “calculated risks” early in career, so that they can aim to become well off. Once you have enough money, don’t take risks, just put into conservative instruments & retire. I would NOT advise people to buy properties while they are building their wealth, especially houses, since they are expensive assets & most people take loans to acquire them. Loans are huge risk, coz during the time you are repaying loans, your ability to withstand any other crisis is NIL..The problem with properties is they are illiquid, you cannot sell it easily, & it will NOT help you in any crisis. Kids will get a huge headsup in their life with a few millions in the bank instead of some xyz property in their home towns. And if the kids go to another country & settle down, they seldom ever come back. I have seen a few struggling alone to sell their properties in very old age since their useless kids refused to even come & help sell them. One of them has just left the property idle here & settled abroad, so the entire money & the appreciation is a waste…Once you become rich, you can diversify some of the wealth into properties as a hedge against currency risks – as I mentioned in my earlier thread on this subject.

 

[renuka]

BTW as I age I find my need to spend money is less..so I wonder what the heck are senior citizens going to spend so much as they age?

I wonder why is moderation in life being viewed as suffering or deprivation?

No one is dying..everyone is living well within their means.

What do people really want to do as they age?

I see my dad spends his time writing books and he is into his 3rd book and busy getting it published.

He is not complaining..he is satisfied with life.

I dont think senior citizens spend that much BTW.

 

[Jaykay767]

Agree with Balasubramani here !

One should NOT invest & take risks in old age, thereis NO way to recover from disasters. So they should keep all the money saved sofar in Bank FD’s & live on the interest. And they should adjust theirliving based on the interest income.

On the other hand youngsters should invest & take “calculatedrisks” early in career, so that they can aim to become well off. Once you have enough money, don’t take risks,just put into conservative instruments & retire.

I would NOT advise people to buy properties while theyare building their wealth, especially houses, since they are expensive assets& most people take loans to acquire them. Loans are huge risk, coz duringthe time you are repaying loans, your ability to withstand any other crisis isNIL..The problem with properties is they are illiquid, you cannot sell iteasily, & it will NOT help you in any crisis.

Kids will get a huge headsup in their life with a fewmillions in the bank instead of some xyz property in their home towns. And if the kids go to another country &settle down, they seldom ever come back. I have seen a few struggling alone tosell their properties in very old age since their useless kids refused to evencome & help sell them. One of them has just left the property idle here& settled abroad, so the entire money & the appreciation is a waste…

Once you become rich, you can diversify some of thewealth into properties as a hedge against currency risks – as I mentioned in myearlier thread on this subject.

 

[krish44]

One thing I am unable to comprehend.

Why do senior citizen all the time think of age and that being the reason for actions not taken .

Some normal and healthy give up on good living and stop being active participants in any activity involving money and holding on tight to what they have.

Similarly I cannot understand the parents hanging on to their children and leaning on them when they are hale and hearty.

They advertise their helplessness and want only to advise others specially children on what not to do based on their experience of older days which are outdated and

useless.

This sends a very negative vibes to everyone.

so far age has never been a limitation [though I take it as one of the issues] in any of my decision making.

now I realise why parents are unwanted everywhere after seeing how senior citizen respond here to many issues

we have as free to do anything as we believe ourself to be.

If we approach issues with this mindset , we will definitely gain not lose

 

[Raji Ram]

The million dollar Q is 'How much money is ENOUGH'?

Moderate living is always the best, though some people brand us as 'kanjoos'! Some mAmis are surprised when they find that I don't

have a huge fridge/ microwave oven / automatic washing machine / induction stove and so on.......... I just don't care because we

have got everything for a comfortable living.

There is one mAmA in my extended family, who is fondly named by the kids as 'Casino mAmA' since he likes to go to different cities in

India and abroad to 'play' in a Casino! He spent most of his savings believing an astrologer who coolly fixed his year of expiry as 84!

Now he has lost most of his savings and still alive at the age of 94!! His sons who could not tolerate his ways of living are now helping

him, just to maintain himself in a senior resort. He has an assistant who is paid Rs. 10,000/ as salary and Rs. 6,000/ for food! :faint2:

 

[Jaykay767]

Krish –

It is all about risk management in life & age is oneof the risk factors.

Why should anyone risk their savings when they areretired? i.e, when they have no income from a Job. When one is young, they cantake more risks, because they can recover from a disaster.

There are enough statistics like Balasubramani said,where senior citizens have lost their lifetime earnings in some chit fundschemes or other..

One should take risks when they have a Job & goodincome, and that risk should be calibrated down as one goes towards 60 yrs orbeyond.

However I do agree with you, some of the seniors loseinterest in everything very early, while they can do private consultancy &earn good money with their vast experience.

That’s why I said in my earlier thread, the best thingone can do in retirement is start a business with VC funding (never with yourown money), you never know, with all the experience, one can strike very big.

Cheers,

 

[prasad1]

I think Krishji is saying that enjoy your life, and spend the money to make it happen. I do not think he wants others to have his risk tolerance or expected funds for comfortable living. No two person will have the same level of spending to be comfortable. I have seen people who are well to do and scrimp on spending the money even for basic conveniences. They leave a huge fortune for their children, who blow it on frivolous things.

Instead of scrimping and being miserly the elders could have lived a little more luxuriously. That is difficult for average Indian.
The children are well settled, they do not need the nest egg, spend some on yourself, just like that Coffee shop guy in PJji's post.

If you have not watched the movie "Baghban", please do.
Baghban is a 2003 Bollywood drama film directed by Ravi Chopra, featuring Amitabh Bachchan and Hema Malini in lead roles. Aman Verma, Samir Soni, Saahil Chadha and Nasir Kazi portray their four sons. Salman Khan, Mahima Chaudhry, Paresh Rawal, Rimi Sen and Lilette Dubey are featured in supporting roles. It is an unofficial adaptation of the 1937 movie Make Way for Tomorrow and many scenes and the plot of the film was also inspired from the 1958 Kannada film School Master.

 

[V.Balasubramani]

A sensible individual knows that from the date of his retirement, he won’t be paid the 'much sought after’ pay.

And this sensible individual also know that to continue the standard of his living/to enjoy his life, he had to arrange for a supplementary in addition to the pension and other income to support his living.

Such sensible individual always plan wisely and invest his/her terminal benefits which are nothing but their life time savings safely according to their choice and thus lead a comfortable life and enjoy the living.

No one is very particular to pass on his wealth to his/her next generation.

Again this sensible individual know that he has to meet out unforeseen expenses or emergency situation which are prone to aged people and is ready with some liquid cash. He also know pretty well that a funeral ritual is very expensive thing nowadays. He may also think not to pass on such expenses to his heirs. It is individual’s choice.

But discussing about random cases of misers and spendthrifts is nothing but a waste of time IMO.

Some awake only when they incur huge loss in stock market and it is always the personal experience that will have more impact.

Stock market is such a brutal world where there are 'bulls' and 'bears' and there is no place for half pundits or half pretenders.

If one knows swimming he can go for a dive in a pool. Similarly, if one has fair knowledge on stock market he can take the gamble. Otherwise it is better to keep away in the interest of safeguarding the life time savings.

And there is no point in discussing about random cases.

 

[Jaykay767]

One should invest in their 0-10s (parents should investfor the kids), 20s, 30s, 40s & 50s, by the time they are into their 55+,they should wind down most of the investments, book all profits & keep itin FDs.

The reason is beyond 55+, many lose interest to do anything,they have health issues, problems etc.. so when you are in good physical condition,you should get your financials completely in order. People struggle to even selltheir prime properties in old age, for some it is too much stress.

Small portion (5 to 7%) which they can totally afford tolose can be kept in investments, & if it works, they can come out ahead,otherwise, it does not matter. Even whensomeone is very good in the markets, one should NOT risk beyond an amount onecan afford to lose completely.

Everything in life is risk management – whether in lifeor financials.

 

[biswa]

Perhaps Casino Maama can take on a younger spouse. That will surely increase the expenses and improve entertainment in old age.