Provident fund.. Is it enough

The provident fund is the panacea for all retirement planning and has assumed iconic status. However life is always dynamic and one needs to keep relevant to the changing dynamics of lifespan and see how much the pf can support us through non earning times.


There are some significant changes that one now needs to factor into our calculations . These are mentioned below.

1. Changes in our lifespan

The average lifespan in india has gone up and for people in the middle income bracket this has gone up by almost 15-20 years on an average. So someone who was expected to live till 70 years can now be expected to live till 85.

Womens lifespan is higher ( yeah men have been given all of the cholestrol problems) so with the average difference between husband and wifes to be lets say 4-5 years, and wifes expected to have an lifespan of another 5-8 years over their husbands , our entire planning scenario has changed !

Now one needs to plan for +15 yrs ( male lifespan increase) + 8 years ( additional women lifespan) , which is another 23 years of sustenance of ones earnings through the savings one creates in their working lives.


2 Healthcare costs
Healthcare costs are on the rise, at a much faster rate than the inflation rate . While India continues to fight the battle on patents which contribute no value, the multi billion $$ industry continues to push for patents which will keep their coffers flowing forever.


The above two really make a big dent on your saving plans... And need to be factored into the overall scenario building you have basis the PF savings.

Its easy to build a plan and create a simulation. If you dont know how to do that, let me know and i can create a quick and dirty excel sheet for you to evaluate yourself.

Its simplefinancialsense to evaluate your retirement planning.