For the most part, an investment philosophy for a woman should be no different from that for a man, except for some special situations.

Generally women tend to ignore their retirement needs, even though they have a longer life span and are more likely to outlive their husbands.

Here are a few things that women should know about their investments.

Independence

Many women allow their men folk to make investment decisions for their family and their own savings, too. This dependence could make them vulnerable later on.

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During later years, if the woman has to fend for herself or is widowed, she must have knowledge of the family investments and family wealth. She should be in a position to use them for their intended goals and also to draw income from them for her living expenses.

I observe even career women leaving investment related decisions to their husbands, very often. This is a no-no.

Retirement income

If career women ignore savings for retirement, they must ensure that their husbands' retirement plan factors income for the wife even after the husband dies.

In case of pension plans, the husband should have opted for a full pension for the survivor. Unless they are a part of the financial planning, they will not realise the impact of inflation on future expenses.

Remember that retirement is a double whammy � whereas the income stops, the expenses continue to grow due to inflation. Retirement nest eggs must be designed to beat inflation, allow for emergencies such as medical treatment and also minimise tax outflows.

Single mothers

Life can be pretty difficult on them. Widows with young children should preferably go to financial planners to make best use of their insurance proceeds and savings to meet future goals such as educating children, marrying them off and living expenses for themselves.

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Mothers tend to be self-sacrificing, reserving all the resources for their children, without planning for their own selves. There should be a proper balance in thought and plan, accounting for everyone's needs.

They must give a high priority to covering themselves with sufficient life cover (ideally a big term plan), as premature death of the mother will leave the child orphaned. The insurance cover should be sufficient to provide living expenses and education expenses for the child.

Education

It is worthwhile to learn the basics of financial planning and investing, so that in any eventuality, the woman is able to take charge of her financial affairs.

Immediate relatives such as in-laws, uncles, close friends etc may not always be trustworthy enough to hand over management of your savings. Awareness also comes in handy to ensure that family savings are not exposed to undue risks by over confident, day trading husbands!

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It is important for women to understand all about the various investment options, their pros and cons and make risks work in their favor. They must understand the basics of asset allocation, bonds, equities and taxation.

Trust

Many women tend to place too much trust in some people once they are familiar with them. It is required that the investors should have trust in their financial advisors, but when it comes to investing, I would rather advise prudence and caution.

Do a reality check if:

• Your husband has covered his life sufficiently enough to ensure family has enough to live comfortably and reach goals in case of his untimely demise
• The policy is in favor of the wife and children
• The policy is registered under the Married Women's Property Act
• That a financial plan exists and is being followed for the family goals, including a plan for providing income to the wife after the husband's death
• Liabilities are sufficiently covered with term insurance  

On the positive side, I have observed that women, once educated, tend to manage their investments far better than many men!

The emotional make up of women (resilience), combined with naturally conservative tendencies help in producing better long-term returns. Hot tips do not attract them, nor do they look for short-term returns.

The author is the Managing Director, Hexagon Capital Advisors Pvt. Ltd. He can be reached at bhagavat@hexagononline.com