When I met my friend three years after her husband passed away, she insisted that I stay back to hear her stories. She had been married into a traditional family at 18. After 42 years, with her two children having settled into their own homes and lives in another part of the city, she was on her own. She was extremely delighted at her new-found freedom. Senior single women are now living the lives they lost to needless servitude for many years. They did not necessarily suffer in an acrimonious marriage, but had been held hostage to customs, rituals, practices and patriarchy of the earlier times. Many of them did not pursue a career. Even if they did, they gave up promotions and higher responsibility to take care of home. They managed their jobs and homes when they worked, and many did not make independent financial decisions with their money. Now, finally, they have been set free.

My friend told me that she now travels with women groups within and outside the country. She had only stepped out to religious places and temples earlier; she is now a tourist and showed me pictures of her curated tour to the Northeast that she took with 12 other women. Limitless fun, she giggled. She dressed better, buying sarees and colours that she liked. Her jewellery and accessories are bolder. She is just one of the many women who have found their feet much later in life, but are determined to make the most of it. Then came the question of finances. My friend told me that she never got involved when her husband was alive, but is now fully in charge. She has been reading, asking questions, learning technology as needed, and taking help from her children. What are the simple rules for single women like her, who want to remain independent for the rest of their lives?

First, keep it simple. There is no need to manage multiple bank accounts, mutual funds, brokerage accounts, properties and assets. Consolidate the assets in a manner that makes it easy to monitor and manage efficiently. Two bank accounts, one for the family pension and another for everything else, will do. All other investments should not exceed 10-12 products. There is no need to own stocks or trade unless one is interested in such activity. A few actively managed diversified mutual funds and a couple of ETFs will do the job with respect to equity investing. Some bank deposits are adequate for income and yield. A balanced fund is a better route to managing both equity and debt in a single product.

Second, learn operational, procedural and tax-related aspects. I have seen many women learn processes very efficiently, even if they are put off by product brochures and returnrisk matrices. Learn to keep passwords and change them; master the operational aspects of cashless payment, cards and credit. Take the time to understand income tax returns even while engaging a professional to file the returns for you. Learn about phishing, scams and online security, which is simple and common sensical. Be a hands-on manager for your money since it is not tough to operate if you don’t have a complex portfolio.

Third, do not be tempted to change, revise, and rework your investment strategy too often. This may be superfluous. If you hold a few long-term products with simple and specific features, you will do fine without modifications. Review once a year to see if something is not working well. Discuss with your advisers and friends, and read yourself before making changes. There is no need to jump into the latest bandwagon. Just ensure your current train is moving steadily as desired.

Fourth, learn about the options for using your money, and optimise these. Understand how a systematic withdrawal plan works. Learn that idle, unutilised money in the bank is wasted. Have a short-term bank deposit to bunch up savings for a few months and use it as needed. Understand how your regular income, investment income, and principal drawals are being spent. Even if you don’t keep account, learn to review bank statements and credit card statements to check which are the major heads of expenses. Keep control and be informed.

Fifth, learn to keep money matters private. Your financial adviser and accountant are bound by contract to keep your information private. You need not discuss the actual numbers, flows or stocks with others. Be discreet and learn that power comes from keeping money decisions close to your chest. If you gift a nephew Rs.10,000 at his wedding, it will be seen as a generous gift. Not if they knew that your assets are worth Rs.10 crore. Others don’t have to feel entitled to your wealth, however small or large it might be.

Sixth, adopt minimalistic lifestyle to make it easier for your children after you pass. At this stage of life, you care more for experiences than things. Keep the material things minimal, and give away and reduce what you have. I recall the painful task of evaluating and selling a locker full of jewels that children of another friend had to endure. If you must keep them, take the time to tabulate their cost, year of purchase, weight and such information. If it is tough for you to do this, imagine the plight of your children after you are gone.

Seventh, focus on your health and develop healthy habits to keep fit. Inform your children about your desire with respect to invasive health care, terminal illness and caregiving. Allocate funds for default medical check-ups and follow-ups. Be willing to spend on supportive help. Ensure a good network of friends and relationships to keep you cheerful, and reach out to when in need. It is lovely to be independent and able to reclaim the joys of one’s life. Align the finances and exercise the same enthusiasm to keep control and be in charge.


(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)

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