Many salaried employees wonder whether they should continue building their retirement corpus through the Employees' Provident Fund (EPF) or shift money to mutual funds in the hope of earning higher long-term returns.While both the EPF and mutual funds can be crucial for long-term financial planning, they function differently and also serve different purposes. For long-term investment planning, many investors invest in equity mutual funds. While equity mutual funds are market-linked investment products that attempt to increase wealth but include investment risk, the EPF is a retirement-focused social security plan supported by contributions from both the employer and the employee.Through a video posted on its official X (formerly Twitter) account, the EPFO has highlighted the key differences between the EPF and mutual funds, comparing them on bases of returns, tax benefits, retirement security, employer contribution and death benefits. Here is what the EPFO says in its video:EPF is mandatory; mutual fund investments are voluntaryThe EPF is a statutory social security scheme, whereas a mutual fund is a voluntary investment option. Organisations and employees covered under the EPF Act are required to become EPF members, and it is an employer's responsibility to deposit regular EPF contributions.Account closure rules for EPF and mutual fundsYou cannot close your EPF account on your own. The basic goal of the EPF is to offer financial security after retirement, whereas mutual funds seek capital appreciation. Mutual fund folios can be closed anytime. The EPF requires both the employee and the employer to contribute up to 12% of the employee's base pay.Mandatory EPF contributions by employerAn employer's mandatory contribution provides an additional financial benefit in the EPF, while mutual funds do not offer such a feature. The EPF earns interest at a government-declared rate, and regular monthly savings are automatically ensured. There is no contribution from the employer in case of mutual fund investments.Returns in mutual funds and EPFInvesting in mutual funds is entirely voluntary and involves market risk. Returns depend on market movements, meaning there is the possibility of both gains and losses.In the EPF, contributions, interest earned and eligible withdrawals are tax-free, whereas mutual fund investment returns may attract capital gains tax.Retirement benefitsThe EPF also provides additional benefits of the Employees' Pension Scheme (EPS) and Employees' Deposit Linked Insurance (EDLI) to its subscribers. The EPF is administered by the Employees' Provident Fund Organisation (EPFO) under the Ministry of Labour and Employment, Government of India. Eligible members may also receive a lifelong pension after retirement through the EPS.Mutual funds do not offer any such social security benefits. They are managed by private asset management companies and do not provide pension benefits.Death benefits in mutual funds and EPFIn the event of an EPF member's death, their family may receive a pension and life insurance coverage of up to Rs 7 lakh under the applicable schemes. With mutual funds, beneficiaries receive only the value of the investment.Stable income and risk in EPF and mutual fundsThe EPF helps build a stable and secure retirement corpus over the long term. Mutual fund returns are uncertain because they are linked to market performance, and there is no guarantee of capital protection. The EPF offers social security and financial protection for the future.