Introduction

The last generation, including our parents are generally a little behind in finances and post retirement plans. We may fear that this lack of knowledge may prevent them from making informed choices to lead a stable and peaceful life post retirement. So the question arises, “should I plan my parent's retirement?” The answer is yes. You must definitely plan your parent's retirement. Read this blog till the end to properly plan your parent's retirement.

Follow the steps given below to plan your parent's retirement efficiently.

Have a conversation with your parents about their financial status- The first step in planning for your parent's retirement would be to openly talk about their finances, keeping the awkwardness aside. This way, you'll understand how much your parents have saved and invested over the years, and if they have debt. This will help you make an informed decision about parent's retirement.

Find ways to increase savings and avail benefits of government schemes- It would be better if savings are started as early as possible. Various goverment schemes allow you to save taxes and increase your savings for retirement. For instance-

The Section 80CCC and Section 80CCD(1B) of the Income tax act 1961 allows you to avail tax deductions up to ₹1.5 Lakh + 50,000. These deductions can be availed through investments in certain specified programs, like NPS. Also, if your parents invest in NPS, Section 80CCD(1B) of the Income tax act covers the additional deduction of ₹50,000.

Section 10(10D) of the Income tax act states that investment in Life Insurance is eligible for a tax exemption of ₹1.5 lakh.

A tax exemption of ₹1.5 lakh is permissible via Section 80C if investment is made by your parents to ELSS.

Under Section 80C, investment in PPF is eligible for a tax exemption up to ₹1.5 lakh. Under Section 10 of the Income tax act, interest and maturity are relaxed from tax.

Avoid delays- The early you start planning for your parents retirement, the more benefits your parents can reap. To know more about how to save for retirement, visit pensionbox.