See if your withdrawal amount is safe, or how many months your savings will last.
Simulates the corpus month by month: it earns a return, then the withdrawal is deducted.
If withdrawals consistently exceed what returns replace, the corpus eventually reaches zero.
Each month: Balance × (1 + monthly rate) − withdrawal
An SWP calculator tests a Systematic Withdrawal Plan, where you take a fixed sum from a mutual fund every month while the rest stays invested. It is the mirror image of a SIP: instead of building a corpus, you are drawing it down.
Retirees in India often use an SWP from a debt or hybrid fund as a monthly pension substitute, and people with a lump sum from a gratuity, a property sale or a maturing policy use it to create regular income. The question it answers is simple: at this withdrawal and this return, what is left after a chosen number of years, and does the money last?
This calculator also lets you raise the withdrawal once a year for inflation, because living costs in retirement do not stay still.
1. Note the starting corpus C, the first monthly withdrawal W, the expected annual return R%, the yearly inflation increase g% and the number of years N.
2. Find the monthly rate: i = R ÷ 12 ÷ 100.
3. Each month, grow the balance and then take the withdrawal: balance = balance × (1 + i) − W.
4. After every 12 months, raise the withdrawal: W = W × (1 + g ÷ 100).
5. Repeat for N × 12 months, stopping early if the balance reaches zero.
6. Add up all withdrawals for the total withdrawn. Total interest earned = final balance + total withdrawn − C.
A corpus earning a monthly rate i produces C × i of return each month. If you withdraw less than that, the balance grows; if you withdraw more, it shrinks. So the break-even flat withdrawal is about C × R ÷ 1200. For ₹50 lakh at 8%, that is about ₹33,300 a month. Once withdrawals rise with inflation, even a starting amount below break-even will eventually exceed it, and from then on the corpus falls faster and faster. That is why a plan that looks safe with 0% inflation can run dry when a realistic increase is added.
The calculator applies the same return every month. Real funds do not behave that way. If markets fall early in retirement while you are withdrawing, you sell more units at low prices, and those units are gone before any recovery. Two plans with the same average return can end very differently depending on when the bad years arrive. This is one reason retirees usually keep the SWP money in lower-volatility debt or hybrid funds and hold a buffer of one to two years of withdrawals in a liquid fund.
Each SWP payment is a redemption of units. Only the gain portion of each redemption is taxed as capital gains, not the whole withdrawal. In the early years most of each payment is your own principal coming back, so the taxable part is small. This is different from FD or SCSS interest, where the entire interest is taxable income each year. The calculator does not model tax, but this difference is often why people prefer an SWP to a monthly interest scheme.
Rajan retires with ₹80 lakh in a hybrid fund. He wants ₹40,000 a month, raised 4% every year, and assumes the fund earns 8% a year over the 25 years he plans for.
Answer: Final balance after 25 years ₹45,85,733; Total withdrawn ₹1,99,90,036; Total interest earned ₹1,65,75,769
Leaving the inflation adjustment at 0%, which makes almost any plan look sustainable.
Assuming equity-like returns on money that is needed every month and should sit in steadier funds.
Ignoring sequence risk and keeping no cash buffer for the first bad year.
Planning for too short a period; a 60-year-old can reasonably need income for 30 years or more.
Forgetting exit loads or tax on redemptions when setting the withdrawal amount.
Turning a retirement corpus into a planned monthly income.
Deciding how much of a gratuity or PF payout can be spent each month.
Testing whether a corpus can survive rising withdrawals over 25 to 30 years.
Funding a child's hostel and college fees monthly from a lump sum set aside earlier.
What does 'sustainable' mean here?
It means the returns on your savings are enough to cover your withdrawals, without your balance running out over time.