New Delhi: Many people dream of saving Rs 1 crore for a secure future. But inflation quietly reduces what that money can actually buy over time.
Prices of daily needs like food, housing, medicine, and transport keep going up. This is tracked through the Consumer Price Index in India. Even a moderate rise adds up over years.
Take an average inflation rate of 5 per cent each year. In 10 years, Rs 1 crore today would have the buying power of only about Rs 60-62 lakh. On the flip side, things that cost Rs 1 crore now might need around Rs 1.6 crore then.
A simple example: flats in big cities that sold for Rs 1 crore earlier now go for double, even if nothing about them has changed.
For retirement, this hits hard. If you plan for Rs 1 crore at age 60 while working at 50, higher medical and living costs could leave you short.
Savings in bank fixed deposits or accounts feel safe, but their returns often lag behind inflation. The real value drops.
Better choices for long-term goals include equity mutual funds, index funds, or flexi-cap funds, which can grow faster than prices rise. The National Pension System works well for retirement. Hybrid funds mix safety and growth. Gold helps in tough times.
The key is to invest in options that outpace inflation. Otherwise, your hard-earned money loses strength quietly.