Turn a corpus into monthly income: see how long your money lasts at a given withdrawal, and what happens to the balance along the way.
How an SWP works
A systematic withdrawal plan redeems a fixed amount from your mutual fund investment every month. Whatever remains stays invested and continues to compound. The corpus therefore runs a race between withdrawals draining it and returns replenishing it. If your annual withdrawals stay below the corpus's earnings, the balance grows forever; above that, it depletes on a schedule this calculator computes month by month.
The break-even withdrawal
Perpetual monthly withdrawal ≈ Corpus × r / 12
At an 8% return, a ₹50 lakh corpus earns about ₹33,300 a month on average — withdraw less than that and your corpus is effectively perpetual (though market volatility means real-world outcomes vary around this average, especially in the early years).
Worked example
₹50,00,000 corpus, ₹30,000 monthly withdrawal, 8% p.a. return: the withdrawal (7.2% of corpus per year) is below the 8% earning rate, so the balance actually keeps rising while paying you ₹3.6 lakh a year. Raise the withdrawal to ₹45,000 and the corpus depletes in about 17.6 years after paying out roughly ₹95 lakh — nearly twice the starting amount, thanks to returns earned along the way.
How to use this calculator
- Enter your corpus, planned monthly withdrawal and expected return.
- If the balance never falls, the calculator reports the corpus as lasting 50+ years.
- Pair with the FIRE calculator to first size the corpus you need, then test withdrawal plans here.
Frequently asked questions
What is a systematic withdrawal plan (SWP)?
An SWP automatically redeems a fixed amount from your mutual fund every month and credits it to your bank account — the reverse of a SIP. The remaining corpus stays invested and keeps earning, which is why an SWP can pay out more in total than the corpus you started with.
How long will my corpus last with an SWP?
It depends on the gap between your withdrawal rate and the fund's return. If you withdraw less than the corpus earns, it never depletes and actually grows. Withdrawing ₹15,000 monthly (₹1.8 lakh/yr, i.e. 9% of a ₹20 lakh corpus) at an 8% return depletes in about 21 years; at a 4–5% withdrawal rate, most corpora last indefinitely.
Is SWP income taxable?
Each withdrawal is a redemption, so only the capital-gains portion of it is taxed — not the whole amount. For equity funds, long-term gains above ₹1.25 lakh a year are taxed at 12.5%. This usually makes SWP far more tax-efficient than FD interest, where the entire interest is taxed at slab rate.
What is a safe withdrawal rate in India?
The classic 4% rule comes from US data; for India, with higher inflation, planners often suggest 3–4% of the corpus per year (rising with inflation) for a 30+ year retirement from a balanced portfolio. This calculator uses a fixed monthly withdrawal — increase it periodically in your planning to reflect inflation.
SWP or annuity for retirement income?
An annuity guarantees income for life but locks your capital and typically yields less, with the income fully taxable. An SWP keeps your capital flexible and tax-efficient but bears market risk. Many retirees blend the two — an annuity or government schemes for essential expenses, SWP for the rest.