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5 financial education tips for our grandparents

It's never too late to save: Older adults are one of the most financially vulnerable population groups.

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This article was translated from our Spanish edition using AI technologies. Errors may exist due to this process. Opinions expressed by Entrepreneur contributors are their own.

Without a doubt, one of the sectors of the Mexican population most affected economically by the COVID-19 pandemic has been the elderly. According to data from the financial coach , Coru, during the pandemic only 17% of this sector of the population was able to cover all of their basic needs thanks to the fact that they had a retirement plan and sufficient savings, the rest had to ask for help financially to relatives or apply for loans.

Depositphotos.com

The importance of knowing how to handle and administer the economic resources of Mexican senior citizens becomes more important, since a good financial education will allow them to enjoy an old age without financial worries.

Data from Coru reveal that in Mexico the pandemic left serious consequences on the finances of families, since 63.8% of the population has recurrent difficulties to meet their basic needs, whether it is the payment of electricity, water, gas or any other service. , 18.0% do not find it so complicated and only 18.2% have no problems with it.

It should be noted that in this complex scenario, the elderly are one of the most vulnerable population groups in financial matters.

“Generally, seniors have various financial problems. This is a consequence of not having planned a retirement fund in advance to enjoy a dignified old age, due - to a great extent - to the lack of financial education and effective management of their income; so, today, we have a population that has few resources to survive, "says Gabriela Aguirre Curcó, Chief Financial Coach in Coru.

To have a more efficient control in the economy of the elderly, Coru recommends:

Well-planned pension income: According to the National Commission of the Retirement Savings System (Consar), 24% of the elderly have retirement, 22% subsist thanks to alimony and only 15% they have a pension. In addition to this, the amounts they receive are not enough to cover all the expenses. Ideally, month after month they make a budget according to their needs, fixed expenses, income and expenses, since this way they will have greater economic independence and planned finances.

It is never too late to save: Although the most advisable thing is to save money from the moment the work begins, it is never too late to start a savings plan. The in-depth analysis of the present financial situation at each stage of life is something that does not have to do with age, but rather with the culture of prevention in the event of any unforeseen event, so it will always be an excellent idea to have an account of saving.

It is never too late to save! / Image: Depositphotos.com

Apply for insurance: The purchase of insurance for major medical expenses can help to cover these types of expenses, which represent a significant financial burden for the elderly population. Data from the National Institute of Statistics and Geography (INEGI) indicate that in Mexico, the pandemic increased the health expenditures of Mexican families by up to 40%.

Currently there are insurance plans tailored to each pocket. Before hiring these services it is important to compare prices, coverage and the amount of deductibles or copayments.

Planning funeral services: Talking about funeral services is a complicated topic, both because of how painful it is for the family and because of the cost involved. Most people do not have these services in advance, which means that they have to be hired at the last minute, when the family begins to grieve. Therefore, Coru advises that seniors have savings earmarked for this event or hire this service in advance, so the choice will be a planned expense and prices and options can be compared.

Without fear of applying for a loan: As in any stage of life, there are situations in which it is convenient to have a financial service to cover any need or unforeseen, so requesting a loan can be of great help. According to estimates from the Inter-American Development Bank (IDB) for Latin America and the Caribbean, by the year 2030 the population of the elderly in Mexico will increase by 55%, that is, there will be 14 million women and men with more than 60 years, so the approach of financial products and services for this sector becomes more important.

Contrary to what is thought, the correct and intelligent use of a credit can help to considerably improve the quality of life of an elderly person, since it allows them to face expenses, solve a medical emergency or grow their assets.