New Delhi, Oct. 5 -- Recently, at dinner, I met individuals in their 50s, nearing retirement, and those who had already hung up their work boots. The hot topic was the rising cost of living and how to meet cash-flow needs during the golden years.

While most had built a sizeable corpus by investing in equity mutual funds over the years, some, particularly those in their 60s, had chosen the 'Income Distribution cum Capital Withdrawal' or IDCW option (erstwhile referred to as the dividend option), hoping to earn regular income to meet retirement expenses.

I was surprised by this and explained why this may not be a definitive way to address cash-flow needs.

The fact is, IDCW payouts are not guaranteed, unlike interest-earning fixed-income ...