AMC Speak

Show your parents that you care

Rajnish Kumar, Senior VP - Products, UTI MF

27th April 2017

In a nutshell

Consider just these two data points:

1. Rs.3,500 is the average monthly pension of people who retired from private sector jobs

2. Out of the 90 million senior citizens, 90% continue to work for a livelihood

For children of such parents who wish to support them financially, UTI MF has come up with a very convenient facility called the UTI Family Facility, where you can invest on their behalf and set up an SWP that goes directly into their bank account every month.

As parents we do many things in our life to teach our children about value of money & managing effectively . However, as time passes, those roles begin to reverse. Our Children grow up and have kids of their own and we take a break from active life / working life. Many begin to feel the effects of aging and financial insecurity and it's the time children who are now in their 30s , 40s or 50s start thinking about helping their aging parents with a periodic inflow of money. The changing family structure, lack of social support, accessibility and affordability issue and economic dependence have made sustenance of elderly ones an ardours one.

As per ministry of Statistics, there are about 90 million people who are elderly (above 60 years of age) and out of which 90% are working for livelihood and 30 million are living alone. Another data from Age Well Foundation suggests that 65% of old people are poor with no source of income . All these bring to the fact that there is growing need for providing financial support to the elderly ones including our parents who limitlessly and altruistically do so much for us.

Recognizing this necessity and also to instil social responsibility binding among investors, UTI has come out with UTI Family ( Father And Mother I Love You ) facility w.e.f. 3rd April 2017, adding a dash of emotions to one's investments.

The facility operates simply in the form of Systematic Withdrawal Plan under growth option of UTI MIS Advantage Fund and UTI Wealth Builder Fund. Existing investor as well as new investors can enrol and facilitate a periodic payment to their parents ( either father or mother ) on a monthly basis. The periodic payment would take place by redeeming the units to the extent of payout and would be credited to designated account of either father or mother depending upon mandate given by the investor / unit holder.

The minimum amount of transfer is Rs. 1000/- and in multiples of Rs. 100/- with a minimum of 12 instalments. The beneficiary ( father or mother) has to be KYC compliant and Investor/s with NRI Status are also allowed to avail the option subject to applicable RBI requirements/guidelines including remittance of funds . The investments/payouts under the said facility will be subject to exit loads, tax & other provisions of the said scheme. On taxation, the liability on account of income tax and STT will be on investors while transfer amount to parents will be treated as gift and hence exempted from income tax.

The launch is acknowledged among investing and distribution community for its "emotional alpha" the investment will generate and many of us would be proud to give back to our beloved parents with this option. Please note that money is not all about finances , it's about emotions. Let's make a little effort to make our parents feel big.

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