If you have Rs 1 crore today, it may seem like a huge amount to you. You may think that this can be used to marry off your daughter lavishly, educate your children abroad, or buy a big house. But have you ever thought how much this Rs 1 crore will actually be worth 25 years later, i.e. in 2050? The answer may surprise you and the reason for this is inflation.
Inflation: The silent decline of money
Inflation is the rate at which the prices of goods and services increase over time and the purchasing power of money decreases. In India, retail inflation has averaged more than 6% in the last 20–25 years. However, it has decreased slightly in recent years and we can assume that it may average 5% in the next 25 years.
If we calculate at this 5% average rate, then Rs 1 crore today will be equivalent to just Rs 29.53 lakh in 2050. That is, what is available today for Rs 1 crore, will be available for approximately Rs 3.4 crore after 25 years.
Understand it in another way how inflation erodes the value of money over time:
Suppose, you spend Rs 1 crore on your daughter’s wedding today.
Cost today: Rs 1 crore
After 25 years (at 5% average inflation): approximately Rs 3.4 crore
That is, in 2050, the same wedding or education which is being completed today for Rs 1 crore will take more than three times the amount from your pocket. This is the effect of inflation, which slowly but steadily weakens your savings.
What does this mean for you?
If you think a target of Rs 1 crore is enough, future needs will force you to raise much more than that. It is important to do the right financial planning and make investments that can grow your money faster than inflation.
5 safe investment options to beat inflation
Every investor has a different risk appetite. If you want safe and assured returns, government schemes and bank-based investments may be better for you. Here are five popular and safe options (rates as of August 2025) —
- Public Provident Fund (PPF)
Interest rate: 7.10% p.a.
Benefits: Tax-free interest, 15-year lock-in, deduction up to Rs 1.5 lakh under Section 80C.
Safe in the long term and good returns due to compounding.
- National Savings Certificate (NSC)
Interest rate: 7.7% per annum
Benefits: Government guarantee, tax benefit under Section 80C.
5-year lock-in period, fixed interest.
- Kisan Vikas Patra (KVP)
Interest rate: 7.5% per annum
Benefits: Doubles money in about 115 months (around 9.5 years).
Safe, popular with both rural and urban investors.
- Senior Citizen Savings Scheme (SCSS)
Interest rate: 8.2% per annum (quarterly payments)
Benefits: Government guarantee, tax exemption under Section 80C, investment limit up to Rs 30 lakh.
Ideal for retirees and senior citizens.
- Fixed Deposits (FDs)
Interest rates: 6.6%–7% in big banks, 7%–7.5% for senior citizens.
Some smaller banks offer up to 8%–8.25%.
Safe and easy investment option, but interest rate taxable.
Are mutual funds or stock market better?
Mutual funds and stock market can give returns above inflation in the long term, but they are not fixed. Sometimes the returns are very good, sometimes they can be negative. If your priority is safety and stability, then government schemes and bank deposits are better options. But if you can take the risk, then instruments like equity mutual funds or SIPs can give better returns in the long term.
Conclusion: Conscious investing for the future
Today’s Rs 1 crore will be equivalent to about Rs 29.5 lakh in 2050.
To meet the same expenditure, you will need around Rs 3.4 crore.
To beat inflation, it is important to plan for the long term and choose the right investments.
Government schemes and bank deposits are a good option for safe investments, while investors seeking higher returns can choose equity-based options.
Start preparing today to achieve financial freedom in the future, because the effect of both time and inflation only increases, not decreases.