Adult Children Emerge as Informal Financial Managers for Aging Parents
Adult children are increasingly becoming informal financial managers for aging parents, driven by complex financial products, fraud risks, and digital vulnerabilities. While this transition often begins with crises or retirement milestones and faces initial resistance, families gradually build trust through joint decision-making and professional guidance. The key challenge involves balancing protection with parental autonomy, while estate planning conversations remain particularly difficult due to mortality-related discomfort.
*this image is generated using AI for illustrative purposes only.
Adult children across India are quietly assuming the role of financial managers for their aging parents, navigating an increasingly complex landscape of investment products, digital risks, and sophisticated fraud schemes. This emerging trend reflects the intersection of aging demographics with rapidly evolving financial technology and product proliferation.
The Catalyst for Financial Intervention
For many families, the transition begins with a crisis or retirement milestone. Sahal discovered her parents' financial vulnerability when she had to untangle insurance complications, file complaints with insurers, approach the insurance ombudsman, and correct KYC records. "I realized how exposed they were," she explained. "Not because they can't manage money, but because the system around money has become complicated and risky."
Abhinav Singh in Gurgaon recognized the need for intervention when his father's retirement corpus arrived in 2016. His father, a retired public-sector employee, had traditionally relied on fixed deposits, corporate debentures, and occasional stock trades. Singh observed how corporate deposits promising high returns sometimes left the principal stuck, prompting his decision to restructure the investment approach.
| Challenge: | Impact |
|---|---|
| Corporate Deposit Risk: | Principal amounts getting stuck |
| Inflation Impact: | Poorly structured savings losing value |
| Complex Products: | Difficulty managing alone |
Overcoming Resistance and Building Trust
The transition rarely proceeds smoothly. Singh experienced initial resistance when mutual fund returns lagged fixed deposits during early market cycles. "My father, who monitored performance almost daily, joked to friends that his 'private banker son' was underperforming FDs," Singh recalled. However, as tax efficiency improved and long-term returns materialized, resistance gradually softened.
According to Ajay Pruthi, founder of PLNR Investment Advisors, "Parents often interpret children's financial advice through an emotional lens rather than a rational one." He notes that conversations framed around better cash flows, peace of mind, and succession planning tend to be more effective than discussions focused solely on returns.
Priya Sunder, co-founder and director at PeakAlpha, advocates involving professional advisors when family financial conversations become emotionally charged. "Long-standing parent-child power dynamics can make even well-intentioned advice feel threatening or controlling," she explains.
Protection from Fraud and Mis-selling
Shantanu Nakhare and his sister in Pune intervened before their father's 2019 retirement when bank and NBFC agents began daily visits to pitch endowment plans and assured-return products. They successfully redirected the retirement corpus toward hybrid and debt mutual funds while maintaining income through the senior citizen savings scheme and systematic withdrawal plans.
Their protective measures included:
- Limiting UPI access to low-balance accounts
- Installing spam call blocking applications
- Conducting regular conversations about common scam patterns
- Updating nominees across all financial products
- Completing PAN-Aadhaar linking and KYC revalidation
Ravi Handa in Jaipur follows an even more conservative approach, restricting his parents' UPI usage to one low-exposure account and requiring all product pitches to route through him. "I have not even enabled net banking for them. Any new MF investments are done through old-fashioned cheques," he states.
Balancing Protection with Autonomy
The challenge lies in providing protection without removing parental agency. Pruthi warns against "invisible disempowerment," where parents gradually lose autonomy and dignity by having children control passwords, applications, and transaction approvals entirely.
| Approach: | Method |
|---|---|
| Joint Decision Making: | Discussions with full parental awareness |
| Shared Visibility: | Both parties track performance together |
| Limited Delegation: | Technical tasks only, parents retain control |
| Gradual Education: | Parents understand systems rather than feeling excluded |
Sunder emphasizes that "the balance should be driven by the parents' comfort and capability, not by the child's desire for efficiency or optimization."
The Estate Planning Challenge
While operational financial management gains acceptance, estate planning conversations remain difficult. "When children mention wills, parents don't hear financial prudence, they hear death," Pruthi observes. He suggests reframing discussions around paperwork hygiene rather than inheritance and mortality.
Handa has found indirect approaches more effective, gradually simplifying investments and assets. He successfully persuaded his parents to sell an unoccupied house rather than dealing with ownership transfer complexities later. However, formal estate planning through wills continues to meet resistance, with parents preferring to let children divide assets themselves.
This pattern extends across families, with Sahal, Nakhare, and Singh all reporting similar struggles to move beyond operational cleanup into formal estate planning, highlighting the persistent discomfort surrounding inheritance discussions.
20
