How to create ONE CRORE Rupees from EPF?

How to create ONE CRORE Rupees from EPF? Sounds interesting right? Let us see whether it is possible or not as EPF Is the most ignored investment for many salaried.

Many of us know the power of compounding and also the majority of the salaried are EPF members. Unknowingly they are contributing to EPF as it is deducted from your salary before you get in hand.

What is EPF or Employee Provident Fund Scheme?

I have written a lot of posts on EPF. However, to simplify how you and your employer contribution will work in this EPF structure, let me share the below image for your reference.

How EPF and EPS works

I hope you got a clear idea of how the EPF deduction from your salary and employer contribution is deducted on a monthly basis and get invested.

If you wish to look at the current interest rate or historical interest rates, then refer to my latest post “EPF Interest Rate 2019 – 2020 – Historical interest rates from 1952 to 2019“.

How to create ONE CRORE Rupees from EPF?

Let us move on and understand to create one crore rupees from EPF when you retire. For the accumulation of Rs.1 Crore calculation, I have assumed as below.

Your Salary (Basic+DA)-Rs.20,000 per month, Rate of Interest on EPF-8.5%, your age-25 years (assuming you retire at 55 years of age) and hence you are contributing around 30 years towards EPF, assuming your salary (Basic+DA) increment at 5% yearly. Also, I have assumed that you and your employer are contributing 12% of your salary (Basic+DA) and assumed that you have no prior EPF account (Balance).

If we do this, then we may tabulate the same as below.

create ONE CRORE Rupees from EPF

If we draw the graph of this EPF accumulation, then it looks like below.

How to create Rs.1 Crore using EPF

You noticed that for the first 5 years period, you never experience the compounding effect. From 6th to 10 years onwards a slight visibility. However, post 10 years, it is zooming and touching the Rs.1 Cr mark after 30 years.

Conclusion:- You noticed the power of compounding here. It creates the wonder to your wealth creation IF you hold your investments for the long term. Investing for a few years and expecting a compounding effect is MYTH.

Never touch your EPF accumulated corpus unnecessarily like withdrawing when you change the job or withdrawing for house contruction or any other purposes. Let it slowly build your solid retirement corpus. More than that, this retirement corpus is TAX-FREE as of now. Hence, consider EPF as your BEST debt component of retirement funding.

I know that EPF interest rate changes on yearly basis and also, the time horizon to retirement differs from person to person. However, you can still easily accumulate Rs.1 Crore from EPF by increasing your contribution to EPF through VPF. But do remember that EPF is illiquid investment where the liquidity is possible with certain restriction. Hence, use the EPF as certain portion of your debt portfolio of retirement funding.

Refer our latest posts:-


  1. Could you please explain how did you get the number 3551 for Year 1.

    • Dear Lawish,
      12% of Rs.20,000 is Rs.2,400 (employee side) and Rs.1,151 (from employer side) together per month Rs.3,551.

  2. Dear Sir, Thank you very much for the article. It helps to understand the importance of staying invested over the long term.
    I have a question. Say I worked for a company (Exempted establishment) for 5 years and my PF balance is X. When I move to another company and I transfer the PF balance from the previous company and the PF contribution in the new company is Y. At the year end, how will the interest be calculated in the new company? Will it be calculated based on (X+Y) or will it be based on Y? Please confirm. Thanks.


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