My Sister's husband died and left 50 lakh for her. She has 2 daughters one 6yr ld and other 10 yr old. She is a housewife from 18yrs. She needs regular money. Where can she invest so that her monies are safe. She need about 35000 for her monthly expenditure. Pls suggest

Ans: Your sister’s situation needs sensitive handling. She is going through an emotional and financial transition. Losing a husband is painful. Taking financial decisions during this time is very tough. But she has you by her side. That support is valuable. You’ve done well to seek proper guidance.

She has Rs 50 lakh now. This money must be used very carefully. She also needs Rs 35,000 monthly to run the house. Her two daughters are still young. Education and other costs will come up. She is a housewife. So there is no monthly income from her side.

That’s why she needs safety, stability, and regular income. At the same time, part of the money must grow. She will need it later for the girls’ education and for her own retirement.

We need to split her Rs 50 lakh smartly. We should plan for both short-term and long-term needs.

Let’s do a full 360-degree analysis.

Immediate Cash Needs
She needs regular income for the home. Around Rs 35,000 monthly. This is the first priority.

For the next 2 years, this must be kept in a very safe place.

We can keep Rs 9 lakh to Rs 10 lakh in:

A liquid fund (Regular plan, not direct)

A safe short-term income fund

Or a bank fixed deposit (for 6 months to 1 year)

She can do a Systematic Withdrawal Plan (SWP) from mutual fund every month. Or she can set monthly withdrawal from FD. This gives her Rs 35,000 monthly.

She must not touch the full Rs 50 lakh for this. Only 9–10 lakh is enough for first 2 years.

These options are low risk. And money is available anytime.

Don't go for direct mutual funds. There is no support system. It leads to bad decisions. In regular mutual fund plans, she gets support from a Certified Financial Planner. That gives peace of mind.

Please don’t choose index funds for her. Index funds give no protection. They fall if the market falls. They can’t stop loss. At this stage, she needs active management. A fund manager can protect her capital by switching inside sectors. That’s only possible in actively managed funds.

Emergency Fund Planning
Life is uncertain. She must keep some money aside for emergencies. Medical expenses, home repair or anything unexpected.

Rs 2 lakh to Rs 3 lakh should be kept in her bank savings account or a sweep-in FD. It must be accessible within 1 day.

This is not investment. This is safety net. Emergency money should not be mixed with investment money.

Income Plan for 2 to 10 Years
Once the first 2 years’ income is sorted, we must think ahead.

From year 3 onwards, she will again need monthly income. But instead of keeping more in FD, she can invest in:

Hybrid Conservative Funds (Regular Plans)

Balanced Advantage Funds (Regular Plans)

These funds are safer than equity funds. They give better returns than FD in the long run.

She should invest around Rs 20 lakh here.

She can do monthly withdrawals (SWP) after 2 years. That will give her Rs 35,000 monthly income for the next 8 years.

Why not keep in FD for 10 years?

Because FD returns don’t beat inflation. In 10 years, costs will double. Children’s education will cost more. Monthly household costs will rise.

So she needs some returns above inflation. That’s why a low-risk hybrid fund is better.

These funds are managed by professionals. They move money between equity and debt. That keeps capital safe and gives steady growth.

But please use only regular plans. Regular plans come with expert help from Certified Financial Planners. They help during bad markets. That support is important for her.

Long-Term Growth for Education & Retirement
After 10 years, the younger daughter will need college fees. Your sister too will be older. She needs money for her future.

So at least Rs 15 lakh must be invested for long-term growth.

She should not withdraw this money for 10–12 years.

Where should this Rs 15 lakh go?

Actively Managed Flexi Cap Mutual Fund (Regular Plan)

Actively Managed Large and Mid Cap Mutual Fund (Regular Plan)

This portion should not be touched. Let it grow slowly.

In 10–12 years, it may double or more. That will help during college admissions. Or for her later life.

These funds are not for monthly income. They are for long-term growth.

Never invest this money in index funds. Index funds follow the market blindly. If the market crashes, they can’t protect. Actively managed funds are better. Fund managers work hard to beat the market. They protect capital when market falls. That brings more safety and better returns over time.

Insurance Check
Please make sure:

Your sister has a family health insurance plan

Her daughters are also covered

No ULIP or investment-insurance plans are bought

Only pure term and health insurance plans are used

If she holds any old LIC, ULIP, or investment-cum-insurance policies, get them reviewed. Most of them give very low return. It’s better to surrender and reinvest in mutual funds for better growth.

Ask a Certified Financial Planner to help with surrender and reinvestment.

Monthly Process and Monitoring
Here is what she should do:

Use Rs 9 lakh from liquid fund for 2 years’ monthly needs

Keep Rs 2–3 lakh in savings as emergency fund

Invest Rs 20 lakh in low-risk hybrid funds

Use SWP from hybrid fund after 2 years for monthly income

Invest Rs 15 lakh in flexi cap or large-mid cap mutual funds

Let this grow for 10–12 years for children’s education and her old age

All mutual fund investments must be done in regular plans only. A Certified Financial Planner will help with:

Fund selection

SWP setup

Portfolio review

Switching when market changes

Emotional coaching during ups and downs

Don’t leave her to manage it alone.

Also don’t go with direct plans or bank agents. They don’t give personal support.

Tax Impact Awareness
When she starts withdrawing from mutual funds after 2 years:

Short-term capital gains will be taxed at 20%

After 3 years, long-term gains above Rs 1.25 lakh will be taxed at 12.5%

For debt and hybrid funds, any capital gain is taxed as per income tax slab.

That’s why using SWP smartly is important. A Certified Financial Planner will help her withdraw money in a tax-efficient way.

This way she gets monthly income, but with lesser tax.

Education Planning for Daughters
In 5 to 8 years, her daughters will go to college. She needs money for that.

If she keeps Rs 15 lakh invested in growth mutual funds, that will be ready when needed.

She can withdraw it over 4–5 years as per requirement. She can take help from a planner to switch to safer funds 1 year before the college fee is due.

That way she avoids market timing risks.

Education cost is rising faster than inflation. So, planning from today is important.

Emotional and Financial Strength
She must not feel she is alone.

Having Rs 50 lakh is good. If used properly, it can give her:

Monthly income

Emergency security

Education for children

Retirement support

But if used wrongly, the money may get over in 6 to 7 years.

That’s why proper structure is very important.

Please appoint a trusted Certified Financial Planner to help her. Someone who will check her portfolio every year. Someone who will call her during market fall and support her emotionally.

Women who do not have financial exposure need this kind of hand-holding.

This help is not available in direct funds or index funds. Only a professional relationship gives it.

Finally
She is in a delicate stage. But she is also strong. She can rebuild life.

Her husband’s savings must now become her strength. The money must be used carefully.

Here’s what matters:

Rs 35,000 monthly income is possible with low-risk plan

She must keep part of money for long-term goals

She must avoid direct plans, index funds, and insurance products

She must invest only through regular plans with CFP support

She must review portfolio every year

She must not panic during market corrections

She must plan for children’s future calmly and with help

With this kind of 360-degree plan, her future can be peaceful.

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment