This Mother's Day Give her the gift of Financial Security

To which my brother replied, "There are plenty of gift ideas for Mother's Day, however, gifting something that would show our love and care for our mother not only for a moment now but also, in the future, could be the best gift ever."

Both of them asked me curiously, "Mitali, what according to you will be the best gift for our mothers that will a memorable one in the future and not just some materialistic gift we give every year on Mother's Day"

To which I responded, "You see, considering the current the uncertainties around us, why not surprise our mothers with the gift of financial security, that will not only financially support her now but also in the future."

Shruti replied, "Wait a minute, do you mean a financial gift? What exactly should we plan for as a financial gift for our mother?"

Women, as mothers, entrepreneurs, wives, and daughters, never fail to surprise with their innate flair for multiple skills and ability to multitask. To be grateful for their selflessness, this Mother's Day, gift your mother financial security for her future.

Why not gift your mother something that can last her a lifetime, with a little foresight and planning, you can give her the best unique Mother's Day gift. There is a peace of mind that comes with long-term financial security and this could be a memorable gift.

Join Now: PersonalFN is now on Telegram. Join FREE Today to get ‘Daily Wealth Letter’ and Exclusive Updates on Mutual Funds

Here are five financial gifts you can consider for your mother that will truly surprise her this Mother's Day:

1. Open an account under 'Senior Citizen Savings Scheme' (SCSS)

A Senior Citizens' Savings Scheme account is a great and safe investment option if your mother is above 60 years. If your mother is not comfortable to invest in market-linked instruments. Instead, you can start an investment in the ultra-safe Senior Citizen's Saving Scheme.

SCSS is a government-backed savings instrument which offers interest at 7.40% per annum. The deposit matures after five years from the date of account opening; however it can be extended once by an additional three years. The interest rate is linked to government bond yields and is subject to change every three months. But once a person invests, the rate remains fixed for the full five-year tenure.

The SCSS is managed by the government and pays interest every three months. However, the upper limit for investing in SCSS is Rs 15 lakh. SCSS suits senior citizens looking for a high fixed rate of return and a regular income on a quarterly basis. Investment in SCSS is also eligible for tax deduction up to Rs 1.5 lakh per annum under Section 80C of the Income-tax Act, 1961.

2. Start an SIP in her name

One can consider setting up a Systematic Investment Plan (SIP) for their mother, apart from FDs, PPFs, mutual funds are a great investment option. If your mother has an interest in investing, then gifting her a SIP in worthy mutual fund scheme would be beneficial for her in future.

Even if she is not a keen investor, a worthy mutual fund scheme can provide her with high returns in future. In case, your mother has never invested in mutual funds, this is a good time to start. You will need to get her KYC done and you may start investing in that scheme via SIP mode you can invest as low as Rs 500. Create an SIP that assists your mother to fulfil her goals such as buying a car, dream vacation etc.

Get in touch with a reliable mutual fund adviser or being a millennial you can easily access to online platform and get the SIP started. This will help your mother to build a corpus for her future needs. You may opt to add in a mutual fund scheme that supports her retirement plan. This will add up to her retirement corpus and she can reap benefits in future.

You can also teach her how to become tech savvy by viewing her portfolio on her phone, and enjoy the power of compounding. SIPs are also more rewarding in times of volatility than lumpsum investments, as they have the potential to earn higher returns due to the benefit of the rupee cost averaging approach. You can eventually choose an SWP plan for the scheme to create a regular source of income during her retirement years.

3. Gift her an Insurance cover

Gifting your mother health insurance ensures that she has access to the best medical care available without putting a load on her financially. We've seen escalating medical costs over the last few years, so it'll be sensible to cover your mother's medical costs with proper health insurance plan. This is the best financial gift you could give her because it provides financial security and meets her medical needs even in your absence.

Indian market currently abounds with options on healthcare plans, with many insurance providers also offering family floater healthcare plans specifically designed to include senior members of the family. Medical conditions can be effectively tackled if they are detected early. Doctors recommend that even young and healthy individuals should undergo medical check-ups at least once in 2-3 years. For Mother's Day, book a full body medical check-up for your mom. A thorough check-up will detect if something is amiss, and could nip the problem in the bud.

4. Gift her Gold in a unique way

Gold is seen as a safe haven during the pandemic. Gold is a wonderful investment since it eliminates the risks of storage and theft. Mothers adore gold, particularly in the form of jewellery, but given the risk it carries, this is the best time to introduce your mother to purchase gold in a unique way.

Instead of physical gold, there are various smart ways to invest in the yellow metal if you are looking for a real rate of return. You may consider investing in Gold ETFs, Gold saving funds or sovereign gold bonds in your mother's name as a financial gift for her. These investments are tied to the price of gold, and their value will fluctuate in line with it, without the inconveniences of assuring purity, secure storage or making charges.

Moreover, as per the sovereign gold bond scheme, the bonds can be gifted or transferred to anyone who meets the eligibility criteria. So, gold bonds can make for an ideal gift for your mother on Mother's Day. It's also a good idea to buy gold ETFs, but for that your mother will need a demat and trading account. A gold saving mutual fund will charge a small fee, but there's no need for a demat or trading account.

5. Empower her with Financial literacy

What better gift to the superwoman in your life who made you independent than financial literacy. Lack of knowledge and being 'jargon inverse' often leads to many women taking a back seat when discussing finances with spouses and family.

Financial literacy will empower your mother with financial knowledge and she could be confident to make her own financial decisions. There are several online e-course that provide adequate financial knowledge at the comfort of your home. You can enrol her for of one these e-course that will equip her with the nitty gritty of financial planning and money management.

Gradually, women should gain all the necessary financial knowledge that would enable them to take financial decisions independently, even in the absence of a spouse due to divorce or death You may teach your mother technology by supporting her, just as she helped you walk by holding your hands. So she can manage her bills, bank accounts and investments at the click of a button. Most of our mothers carry smartphones, you could download the app of her bank and link all the monthly payments to it. Teach her how to operate it so she is self-reliant.

"A mother understands what a child does not say" - a famous Jewish Proverb.

The roles must be reversed in later years of life. You must comprehend your mother's requirements and meet them. This Mother's Day, Plan to give your mother the gift of financial security.

I would suggest you to consider PersonalFN's latest special initiative, the "Certified Family Guardian," offers you an exclusive opportunity to learn the finer nuances of money management.

Organised into eight modules with 24 extensive videos, the "Certified Family Guardian" will help you with all the relevant tools and learning modules needed to get better at money management. It also offers a host of other benefits to help you make informed investment decisions. Read here for complete details...

Here we encourage you to gain and enhance your financial knowledge and become a 'Financial Guardian.' for your family. You will understand the financial planning elements to become your own financial planner and make financial decisions for your family.

So, if you wish to gift your mother financial security this Mother's Day gift, you must enrol for the "Certified Family Guardian" programme today!

Warm Regards,
Mitali Dhoke
Jr. Research Analyst