Most Indians banking on EPF and mutual funds for retirement are chasing a mirage, warns CA and finance educator Meenal Goel, who dismantles the nation’s most trusted retirement strategies in a sobering LinkedIn post.
“EPF gives you 8.15% returns. But with inflation at 6–7%, that’s a real return of just 1–2%,” Goel writes, adding that skyrocketing medical inflation—currently at 14%—makes these numbers dangerously inadequate. She labels this the “EPF illusion,” cautioning that future payouts hinge on a shrinking contributor base amid declining fertility and rising automation.
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Mutual funds, touted as the go-to wealth builder, fare no better in Goel’s analysis. The popular belief that a ₹10,000 monthly SIP will yield ₹3 crore in 30 years overlooks inflation. “₹3 crore today will feel like ₹75 lakhs then,” she notes. “To sustain a middle-class lifestyle, you’ll need ₹15–20 crore.” She points out that while mutual funds may have returned ~12% historically, individual investors typically earned just 6–8% due to poor timing and hidden costs.
According to Goel’s “real math,” a person earning ₹15 lakh per annum would need to save 60–70% of their income to retire securely—far beyond the standard 15% financial advisors recommend.
She contrasts today’s challenges with previous generations, who relied on joint families and lower costs. In contrast, today’s Indians face steep property EMIs, nuclear family setups, and soaring healthcare bills—with little to no fallback.
Her solution? Diversify aggressively. “Your house is your real pension,” she says, arguing that real estate in Tier-1 and Tier-2 cities has consistently beaten inflation. She advocates for continuous income through skills, consulting, rentals, or side businesses—plus robust healthcare planning.
In her stark conclusion, Goel states, “India’s financial industry sells American retirement dreams to people earning Indian salaries.” Without a mindset shift, she warns, retirement may mean working until death—or relying on children.