How Much to Give Mum and Dad

MONEY talk can be a taboo topic not only among couples but also between parents and their grown-up children.
Once the children start working, how much of a cash allowance they give their parents on a regular basis often becomes a touchy issue.
Give too much and the children might suffer financially; give too little and their parents might not be able to maintain their current lifestyle.
Let's look at two contrasting examples. Computer consultant Diana Low, 42, gives a token monthly sum of $200 to her parents, who are retired comfortably.
This is in contrast to her colleague, Ms Joyce Chua, 43, who gives $950 per month to her parents, who are less well-off than Ms Low's parents. She also pays the phone bills at her parents' house.
Both earn about $11,000 monthly and are married with two children.
Clearly, Ms Low's amount will look meagre compared with Ms Chua's.
But advisers such as Mr Stephen Teo, Alpha Financial Advisers' business director, believe that the amount that one gives ought to be a matter of financial capacity and not filial piety.
"Filial piety to me is about the commitment to take care of your parents when they need you and should not be measured by the amount of money you give them," he said.
Mr Tony Tan, a consultant with independent private wealth manager Providend, suggests that if parents are working and can comfortably support themselves, "the gesture of giving is more important than the amount itself".
He explains that this is especially so in traditional Asian societies that hold filial piety in high regard. "This act of giving symbolises our gratitude to our parents for their unconditional love and nurturing all these years," he said.
Ms Low said: "My parents don't need money from me, so the $200 monthly allowance is just a token sum."
On the other hand, Ms Chua considers herself part of the "sandwich generation" - those who have one source of income but two sets of dependants' financial commitments to be fulfilled - ageing parents and growing children.
Anecdotal evidence suggests that many children do not discuss budgets or other money-related issues with their parents early enough.
Nevertheless, good communication regarding finances is critical to a healthy relationship not only between couples, but also between adult children and their parents.
Many start communicating only when it becomes unavoidable - for instance, when their parents are suddenly taken ill and the question surfaces as to who should foot the bill for long-term care.
In Ms Chua's case, her brother Alvin, 37, gives a monthly allowance of $800 to his parents, in addition to footing the annual premiums for their hospitalisation plans.
Ms Chua's parents are retired and totally reliant on their two children to support them. In this case, it is important to know how much would be sufficient for them to lead a comfortable lifestyle.
Mr Teo proposes that before deciding what amount to give your parents, you should have a clear idea of your own financial situation. Only then would you know how much you had in excess to meet various other financial commitments.
Factors that affect your financial capacity to give an allowance to your parents include: income, expenses, the number of dependants that you have, and other financial goals such as housing, education and retirement.
Mr Tan estimates that, as a minimum, $600 a month "should provide a decent standard of living" for one retiree living in his own flat. This is based on certain assumptions such as a fully paid-up home mortgage and a moderate lifestyle, including one annual regional vacation.
For two parents, he worked out that the minimum monthly allowance would be about $1,000.
This amount is sufficient to cover basic monthly expenses such as utilities, groceries and transportation.
As for himself, he gives $1,000 every month to his parents, to be split equally between his mum and dad.
The actual payment can be made in various ways such as cash, Giro, cheque or directly into an investment portfolio.
from: Lorna Tan