The last update in the year in review series is on my returns in 2025. In the short run, the returns might seem high or low, but in the long run it should match my expectation of 10%. That was the assumption I used when I decided to retire early. As long as I can keep my expenses inflation to around 6% and my returns to around 10%, I should be able to manage to live a decent retired life. It has been about 8 years since my financial independence. My long term inflation is currently slightly less than 4%, so that is all good. What about my returns? Are they at least 10%?


Portfolio vs Index

Take a look at the graph shown below. My portfolio returns were 5.2% in 2025, which is better than inflation, Nifty Next 50, Nifty Midcap and Nifty Samllcap returns. However, it is less than total GDP (real GDP + inflation), Nifty 50 and Nifty 500. We are looking at the total corpus returns that includes both equity and fixed income and comparing with equity indices.



Volatility vs Index

For me, volatility is more important than the returns. As long as my portfolio is close to my projections with the least amount of volatility possible, I will be happy. If you look at the volatility (see chart below), you will notice that while my portfolio was following the general trend of the markets, it is less volatile than indices.



Asset Allocation vs Time

I haven’t touched my asset allocation because I felt that the markets are still too high, like in 2024. But as stock market moved, so too has the asset allocation moved along with it. I ended 2025 with an equity allocation of 45%, down from 49% in 2024.



Portfolio vs projections

For those of you who don’t know, I have 3 kinds of projections which I use to compare my portfolio with. The first one is how my corpus should look like if my portfolio gave a return of 8% while my expenses grew by 8% (inflation) year over year. This is the lowest projection line. If my portfolio is performing worse than this projection, then I am in trouble.


The next projection is for a growth of 10% with an inflation of 6%. This is my ideal projection. That is the basis for my early retirement. I assumed that my portfolio would grow 10% year over year on average while my inflation would be 6%.


The last projection is based on a 12% return and 4% inflation. Obviously this is an aggressive projection. It is unlikely that I can maintain a 4% inflation in the long term. On top of that a 12% return on investment is quite high too. Anyway, here is how my portfolio performed in comparison with my projections.



The corpus has stayed between the average and best projections through out the year. So not too bad. As long as the corpus is above the yellow line I am safe.


These are my returns in 2025.

Total corpus returns: 5.2%

Debt MF returns: 7.6%

Equity MF returns: 2.6%


Note that my corpus consists of only equity and debt mutual funds and I have no other investments. No real estate, bitcoins, direct stocks (other than RSUs which I don’t consider part of my corpus, explained below), derivatives, gold, SGB, PF, NPS, FDs, RDs, fine arts, or anything else. Hard to believe I know, but trust me, those are exactly the only two investment classes I have.


Exclusions from corpus

As I have mentioned in several of my posts earlier, I do have a small portion of my RSUs from the time when I worked. Those RSUs are with a US stock broker and I left them there. I don’t count those as part of my retirement corpus because I left them as money I would use when I go on foreign trips. I don’t report any foreign vacation expenses in my blog. So neither the vacation corpus nor the expenses are ever tracked anywhere in my posts.


I am not too concerned about how my RSUs perform. If it performs well, then we can have more vacations before we die ;). If it performs poorly, that we will have fewer vacations. To be clear, I have RSUs from just one company and I have no other investments in the US. So I am extremely concentrated basically into just one company stock. It is an extremely risky behavior I know, but as I said, I am not banking on that money to do anything meaningful to my retirement plan. It is money that I can just blow off on material aspects of life, which we are trying to avoid like plague.


If we have too much money left after we die, I can have it donated to a causes(es) or have it gifted to my daughter. Again, neither of them are in my plan or are active goals. If it happens, let it happen. If it does not happen, that is fine too, since we never even thought about them. I’d rather donate to causes I like while I am still alive. Just to clarify, while our donation expenses are part of our retirement corpus, they never get mentioned anywhere and just hide away in another category that I am not sharing in this blog.


Finally, lets come to the elephant in the room. We have some real estate but we never consider that as investment because either we, or our parents are living in the houses we own. My better half has a house in her home town which intermittently provides her some rental income. It is again not part of our retirement plan. All that money she was saving was used to buy a farm and is being used to make improvements to the farm.


I don’t consider the farm we purchased as investment because we have no plans to sell it while we live. It will be a legacy for our daughter after we develop it. We want to live in the farm and enjoy the natural and organic fruits and vegetables. We are not sure when that will happen. Definitely not in the near future. At least 10 years or more since we still have to take care of parents and our kid who prefer the city. No plans (yet) to sell produce on the farm and make money. If we do sell, we want to at least breakeven since we are spending a lot on the farm. Those details will eventually come in my blog if it ever materializes.


So there you have it. All the details that I could think of. If I’ve missed out on some details that you’d like to know, please leave a comment below. That is all there is to talk about the returns from 2025. Being a stoic, I neither get excited and happy during good times, not do I feel sad or worried when things don’t go as planned. It is just what it is.