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By:

Sayli Gadakh

11 November 2025 at 2:53:14 pm

Why Rs 1 Crore May Not Be Enough for Retirement

For most middle-class Indians, Rs 1 crore is a retirement milestone — but it may not be enough Bharat, 35, has a stable job, a growing income and a clear plan for the future. Discussing retirement with a friend, he says, “If I have Rs 1 crore by the time I retire, I’ll be financially secure.” For many middle-class Indians, Rs 1 crore remains a major financial milestone. But Bharath is not retiring today. If he retires at 60, his target is 25 years away, and inflation could significantly...

Why Rs 1 Crore May Not Be Enough for Retirement

For most middle-class Indians, Rs 1 crore is a retirement milestone — but it may not be enough Bharat, 35, has a stable job, a growing income and a clear plan for the future. Discussing retirement with a friend, he says, “If I have Rs 1 crore by the time I retire, I’ll be financially secure.” For many middle-class Indians, Rs 1 crore remains a major financial milestone. But Bharath is not retiring today. If he retires at 60, his target is 25 years away, and inflation could significantly reduce its purchasing power. Many retirement plans fail because they focus on a future number without considering what it will buy. If inflation averages 6% over 25 years, something costing Rs 1 lakh today could cost roughly Rs 4.3 lakh when Bharat retires. Rs 1 crore could therefore support a very different standard of living. Longer Retirements Earlier generations often relied on pensions, provident funds, family support and savings. That model is changing. Many private-sector employees may have no traditional pension, while longer life expectancy means savings may need to last 20 or 30 years. If Bharat retires at 60 and lives to 90, his corpus could have to support him for three decades. Retirement planning must therefore focus on sustainable income, not simply accumulation. Bharat currently spends Rs 60,000 a month. He expects expenses to fall after retirement as his children become independent and his home loan is paid off. But healthcare, insurance, medicines, household help, travel and lifestyle costs could rise. At 6% inflation, Rs 60,000 today would equal about Rs 2.58 lakh a month in 25 years. The Rs 1 crore target suddenly looks less comfortable. Health And Tax Bharat may have employer-provided health insurance while working but could lose it after retirement, just as healthcare needs increase. His plan should include health insurance, emergency and contingency funds, medical expenses and possible long-term care. Simply investing more is not necessarily the answer. At 35, Bharath has a long investment horizon and may be able to take greater investment risk, depending on his circumstances and risk capacity. As retirement approaches, capital preservation and liquidity become more important. Tax planning is also crucial. Interest income, capital gains, pension income and withdrawals may have different tax implications. With India’s Income-tax Act, 2025 coming into effect from 1 April 2026, long-term plans should be reviewed against the applicable tax framework. The key question is not, “How much will my investment statement show?” but, “What will my corpus be worth after inflation and taxation?” Look Beyond Property Bharat owns a house worth Rs 2 crore, but that does not mean Rs 2 crore is available for retirement. A house provides security and may appreciate, but its value cannot easily fund monthly expenses without changing living arrangements or using a financial product to unlock it. Retirement planning must therefore distinguish between net worth and income-generating assets. Instead of choosing Rs 1 crore as a target, Bharath should work backwards, considering current and future expenses, retirement duration, inflation, healthcare, other goals, investment returns and taxes. The real question is: “How much will I need to maintain my desired lifestyle without depending on my children?” Start Early Bharat’s biggest advantage at 35 is time. Compounding over 25 years can produce a dramatically different outcome from investing for only 10 years. A middle-class family does not need to start with a huge investment. It needs discipline and consistency. As income rises, retirement contributions should rise too, rather than allowing salary increases to disappear into lifestyle expenses. A practical plan should estimate future expenses, account for inflation, maintain a separate emergency fund, provide adequate health and life insurance, diversify investments and consider tax implications. It should also be reviewed as income, inflation, tax rules and family responsibilities change. Bharat now asks, “What lifestyle do I want after retirement, and how much will I need to fund it?” He starts investing early, increases contributions with salary hikes, controls debt and reviews his corpus regularly. He may ultimately need considerably more than Rs 1 crore. More importantly, he understands why. For today’s middle class, retirement planning cannot be based on a number that simply sounds impressive. Rs 1 crore may have been a significant milestone for an earlier generation, but inflation, healthcare costs, longer life expectancy and taxation could dramatically change what it provides decades from now. Retirement security depends not just on the corpus, but on its purchasing power and sustainable income. The lesson is simple: don’t ask, “Will I have Rs 1 crore?” Ask, “Will my retirement savings fund the life I want?” A large number today may not be enough tomorrow. (The writer is a Chartered Accountant based in Thane. Views personal.)

Lost in Transport

Mumbai’s grand transport infrastructure is undermined by potholes, Poor discipline and a last-mile gaps that keeps it crawling

Mumbai: It is morning time, and Pawan Khandelwal is all set to leave for

work. A creative lead at an ad agency in Malad, Mumbai, Khandelwal should

take 12 to 15 minutes to reach the office, but that rarely happens because of

the traffic, poor road quality and lack of civic sense among co-drivers on the

road. He mostly ends up reaching the office in 30 to 40 minutes.


Khandelwal firmly believes that road construction is not a major issue for

traffic. “The road under construction is not a big issue because they usually

don’t take very long to repair the roads. But even after their work is done, it

is not done perfectly. At times when they are digging up the road for other

purposes, they often leave a bump or a pothole,” he said.


He gives an example, “One can see it on the western express highway. There are so many bumps. We call it a highway, but we can’t even drive at 15 km/h because it is not fixed properly.” He also blames people for not following traffic rules, which adds to the problem.


Traffic Woes

Although there are coastal roads and metros available, the traffic still seems to

be a problem for many residents. A media professional and a daily commuter, Charlene Flanagan has been travelling in Mumbai for many years now. There

is not much difference in her experience of the traffic congestion. From her experience, she believes the coastal roads and metros have not completely

accomplished the mission of curbing traffic congestion. She says, “As a resident

of Mumbai and as a person with a valid driver’s licence, I would say the

traf f ic hasn’t really changed. It is still as congested, and whether the

coastal roads have helped depends on the time of the day you leave and whether

you are going against the traffic or along with the traffic.”


The pedestrians also face problems. Saloni Mehta, a theatre artiste, says, “I prefer walking to my destinations. For example, I live in Versova, and if I want to see a play in the Prithvi Theatre, I will take a half-hour walk. However, this one time, I could not

reach the venue, not just because of the traffic but also because there were no pavements left to walk on. The roads are dug up, and every road is just half a road.”


Mumbai’s average speed covered is 5.2 km per 15 minutes. During the peak traffic hours in the morning, when most people travel to their workplace, the average speed is 18.5 km/h.


It is important to understand the issue and address it with a solution. Sudhir Badami, an author of the book ‘Matter of Equitability - Making Commuting in Mumbai Enviable’, explains why people still prefer to use cars over metros, “The metro line 3

has definitely taken away some car users. But it has not taken away sufficient

numbers of car users to make a difference in the state of road congestion. The reason behind this is essentially the last-mile connectivity in areas where the Aqua Line or

Line 7 operates, especially in suburban areas. In the city area, it is supported by good BEST services on the one hand, and taxis being available near the metro stations on the other hand. But most car users still opt for using their cars, as public transport currently does provide assured exclusivity, comfort and good frequency, not forgetting last mile connectivity.


The Coastal Road sees very few cars compared to the number of cars on Mumbai’s Roads. Badami, as a transportation analyst, says, “Mumbai has approximately 16 Lakhs motor cars, out of which only about 55,000 seem to be using coastal roads. It is

such a minuscule proportion for whom so much has been spent. This is largely

because in the city, people don’t go from one end of the city to the other end. They normally start from in between and go somewhere in between. If there is not much time saving for the shorter stretches, then people are not likely to take it, and there will be continued congestion on city roads.”


“In general, the necessity of the last-mile connectivity is an important part, but the greater part will be how to get car users onto the public transport,” says Badami. Public transport must provide near exclusivity, comfort and safety to a car-using commuter for migration to take place. This is where the importance of last-mile connectivity is felt.


Air Pollution

The slow-moving traffic also adds to the air pollution in the city several times more than when they are moving at optimum speeds, he says.


Joint Commissioner of Police (Traffic), Mumbai, Anil Kumbhare, denies that there is much traffic congestion in Mumbai as compared to five years back. He credits the coastal roads for curbing the traffic. He says, “Earlier, there used to be bumper-to bumper traffic near Haji Ali. That has come down drastically. As coastal roads shape, the traffic will go down.”


He also adds that there is traffic congestion in the morning hours as people are travelling for work. But there is no traffic jam. Although coastal roads have helped, there are still pockets of the city that face traffic congestion every day. This can be solved with careful planning and execution.

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