Cathy Heller of Catch The Moon Music advises, "Give yourself permission to be messy."
I think that's good advice when you ad lib Lyric.
Sing something and see if it sings well, and makes sense too. See if what comes out of your mouth suggests a story you'd like to hear more of.
Sometimes that first Line is just a beginning. It may introduce the Singer-Character with a pronoun, 'I'. It may imply the Singer-Character by conversational nature, addressing himself/herself to communicate 'with' another character, with the pronoun 'you'. That's a direct First-Person form of conversation.
The Singer-Character may address him/herself to the listener, telling us about someone else; the pronoun 'she' or 'he'.
That can happen in Line 1 of Verse I, if you start with a Verse. Some Songs start with the Chorus. Those character 'creations' can happen whatever form you choose.
You are the first listener. You make judgment calls about how the 'conversation' is going to go, who's talking to whom.
Here's a Song idea that came to me in a dream. I've been in a 'fallow' period, not writing, but this dream made me want a Song out of it. Before my judgmental faculties came fully awake, I gave myself permission to be messy, and wrote some Verses, led to the Chorus idea from the dream, did some editing, and a 'final' Re-Write. I enjoyed seeing it evolve as much as enjoying the finished product.
Here's what I remembered of the dream when I woke up:

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Another edit, to make it all about the Gypsy, instead of her as an 'Other-Woman, third party Character. March 23, 2021.