While Aryaman has a severe disability, there are varying types and degrees of physical, mental and developmental disabilities. These can range from visual, hearing and speech impairment to ASD, anxiety disorders as well as mood, personality and psychotic disorders. About 1 in 100 children under 10 years of age has autism, and nearly 1 in 8 has at least one neuro-developmental condition, according to a INCLEN Trust International study, in 2018.
For parents of such children, the challenges are manifold. The infrastructure and support for their educational and day-to-day needs are virtually non-existent in the country, while the expenses are exorbitant. This is the reason financial planning becomes crucial.
“This planning is different from that for a normal child because the priorities differ. Besides the long-term care that is required beyond parents’ lives, you need to focus on medical attention, care-giving, special schooling and emergency preparation for the child,” says Nitin Vyakaranam, Founder CEO, ArthaYantra.
Financial Planning
Degree of disability: The first step is to ascertain the degree of your child’s disability: mild, moderate, severe or profound. “The extent of disability decides the level of financial planning you need to do,” says Dinesh Rohira, Founder CEO, 5nance.com. If the child can handle finances or earn a living, your work will be greatly reduced as you may not need to provide for the entire lifetime of the child or set up a trust and seek a guardian. If, however, the severity is high, you will need to plan finances for two generations (yours and the child’s entire lifetime).
Start early: If you are looking at long-term planning, it is critical to start as soon as the disability is detected. Most parents take a long time to come to terms with the situation, and longer to seek medical assistance and start financial planning. “You need to accept your child’s condition and seek help immediately,” says Piya Bajwa, mother of 25-year-old Fateh Singh, who is dyslexic and borderline autistic. A timely start by Bajwa has ensured Singh can not only manage his illness but is also earning a living, helped, of course, by his lower degree of disability.
Starting early is important not only because you need a larger corpus to cover a longer period of time, but also because medical assistance and schooling are more expensive. “All the therapies (speech, behavioural, educational, occupational), besides medical intervention and special schooling are extremely expensive,” says 40-year-old Tanya. Therapies can cost upwards of Rs 1,000 per session and the frequency could go up to 3-4 times a week, or even daily for special activities. Due to the paucity of special schools, education costs are also prohibitive. “We paid Rs 80,000 a quarter for Aryaman’s special schooling alone a few years ago,” says Tanya.
Define financial goals, invest accordingly: Once you are clear about the extent of financial planning required, set specific goals, separating the everyday and very short-term goals from medium and long-term goals. Most parents with special needs kids tend to be risk-averse and put all their money in safe options like fixed deposits and traditional insurance plans. It is crucial to have a portion of your corpus in equity because it will need to grow if it has to sustain over a long period. “For long-term goals, consider equity mutual funds,” says Rohira. For short-term goals, opt for fixed deposits or debt funds (see Financial goals you…). For regular needs, use cash flow or put money in liquid funds.
It is very important to have your own house as well, so that the child doesn’t have to depend on others after your death. You may need to renovate or alter the house to make it conducive to his specific medical needs. “We have installed CCTV cameras to monitor Aryaman’s every move,” says Tanya. Aryaman lives separately, along with permanent caretakers, in a house built especially for him. Importantly, do not forget your own retirement. Keep aside your EPF, PPF, gratuity for this goal.
Life & health insurance: Given the high degree of dependence and expenses for your child, buy a bigger life insurance by calculating the future cost of living, care-giving and medical expenses for the child. The death benefits can also be put in a trust on your death, so that it can serve as a tax-free option for your the child’s financial needs. “Parents should also manage insurance in a more structured manner, increasing the cover size with age and child’s needs,” says Rohira.
As for a health plan, while the insurance regulator, Irdai, has mandated mental health covers by all insurers, in reality, it may not be easy to get one for your child after the diagnosis. “Since it is very difficult to get medical insurance for such children, a good idea would be to have the child covered by your employer’s cover,” says Vyakaranam.
Financial goals you need to save for…
Here are the resources and investments you will need to finance the child’s needs & your retirement
Emergency corpus: Since medical insurance is not easy to come by, it is important to have a medical buffer that is at least 50% more than that for a normal household. “This is because there are spikes in medical needs for such children. Calcluate the frequency of these spikes for your kid, say, once in three months, and average out the cost,” says Vyakaranam. Even if the disability does not entail spikes, keep a buffer separate from the contingency fund for yourself.
Career options: If the child’s disability is not severe and he has skills that can be monetised, consider vocational and occupational training. Fateh Singh, for instance, did a course in designing from Ansal University. “We had noticed from early on that he was very good at photography and computer designing,” says Bajwa. Aryaman, on the other hand, is incapable of working in an office or learning skills because of the severity of his disability. “Other than in extreme cases, you must plan a career for the child in consultation with a counsellor to ensure some amount of financial independence for the child,” says Rohira. There are organisations and NGOs that not only offer vocational training and impart special skills, but also help in placements and securing jobs (see Finding jobs…).
Tax benefits: You can claim tax deduction under Section 80DD for incurring expenditure on medical treatment, training or rehabilitation of a differently-abled or disabled dependent child. The disabilities include hearing impairment, mental retardation, mental illness, autism, cerebral palsy, blindness, low vision, leprosycured, and loco-motor disability. The deduction can also be claimed for insurance premium paid for specific insurance plans designed for the disabled child.
To claim deduction, the percentage of disability should not be less than 40%. The limit is up to Rs 75,000 where the disabiliy is at least 40%, and Rs 1.25 lakh in case of severe disabilities of at least 80%. Parents will, however, need a disability certificate from a specialist in a government hospital as well as proof of actual expenses incurred. Remember also that if you opt for the new tax regime, you will have to forgo this benefit.
Estate Planning
As important as financial planning is estate planning to secure the financial and medical needs of the child after the parents pass away. “The two main challenges are to know who will look after the child’s financial and emotional well-being after the parents are gone,” says Raj Lakhotia, Founder, Dilsewill. “In the absence of a proper plan, the court will simply give custody to the next of kin,” he adds.
Make a will, appoint guardian: To ensure that the best interests of the child, financial, physical and emotional, are taken care of, prepare a will immediately and appoint a guardian. The will should mention in detail how the assets are to be passed on and who will manage these on his behalf. If you are setting up a trust, all these details should also be listed. Since the child will be considered an adult when he turns 18, you will have to seek legal guardianship of the child in order to take all financial decisions on his behalf. Also appoint guardians to take care of the child after your death, someone who understands his needs and will not exploit him financially. It can be a sibling or relative who is close to the child and is likely to outlive him.
Create a trust: A good way to look after the financial needs of the child is to create a trust, placing all the assets, property or investments, in it. “You can even start small and keep contributing to it gradually over your lifetime,” says Rohira. Add the proceeds of life insurance, contribution from family and friends, gifts, property, etc, to it. A trust can be formed either when the parents are alive or included in the will (see How to form a trust…) to be executed after their death. Remember to list trustees, how benefits are to be transferred to the child, when trust will be dissolved, etc.
Finding jobs for differently-abled kids
A major concern for parents with special needs kids is their employability and financial independence. Even as the government reserves 4% jobs for persons with diabilities (PWD), private organisations like HCL, Dell, Accenture, Lemon Tree Hotels, etc, offer jobs for special needs candidates.
Government jobs
In January this year, the Department of Empowerment of Persons with Disabilities notified new government posts reserving for the first time posts for autistic persons and those with mental illnesses. While acid attack victims can hold any Group A, B, C and D posts, specific posts have been opened up for those with mild autism spectrum disorder, including laboratory0based posts like senior scientists in animal nutrition, veterinary, fish pathology museum curator, plant protection officer, associate director (e-governance), lecturers and associate professors. Jobs have also been opened for those suffering from mental illnesses. These include senior Group A and B posts like professors, assistant professors, senior marketing officers, dean of colleges and scientists.
Training & placements
Here are some NGOs and organisations that provide vocational training and job placements for the differently abled. For a detailed list, check Indiaactivities.com/job-for-disabled-handicapped/.
1. Lemon Tree Hotels
The hotel chain employs people with speech, hearing and visual impairment, orthopaedic handicaps, those with Down Syndrome, and acid attack survivors.
Phone: 011-46050101
Mail: hi@lemontreehotels.com
2. EnAble India
The Bengaluru-based firm provides career counselling, training courses for the differently abled in computers, medical transcription, technical writing, life skills, and provides placement with corporates.
Phone: 80673-23636, 98453-13919
Mail: helpdesk@enableindia.org
3. Samarthanam Trut for the Disabled
The NGO’s Livelihood Resource Centres across 13 cities provide training in hospitality, retail, garments, IT, ITeS, etc, and offers placements too.
Phone: 94808-09586, 080-25721444/9922
Mail: info@samarthanam.org
4. Sarthak Educational Trust
The Delhi-based trust offers vocational training and places candidates with its hiring partners like Reliance Retail, Infosys, Flipkart, etc.
Phone: 011-42004238
Mail: sarthakedu@gmail.com
5. National Society For Equal Opportunities For the Handicapped (NASEOH)
The Mumbai-based society provides vocational training and job placements.
Phone: 022-25220224
Mail: admin@naseoh.org
