Retirement Calculator

How This Retirement Calculator Works

Retirement planning has three moving parts. Step 1: Your current monthly expenses are inflated to find what they will cost at your retirement date. Step 2: The corpus required to sustain those inflation-adjusted expenses for 25 post-retirement years is computed using the real rate of return (post-retirement return minus inflation). Step 3: The calculator works backwards using the reverse SIP formula to find the monthly investment needed today to build that corpus by retirement. Every number on screen updates instantly as you adjust your inputs.

The 4% Rule — And Why India Needs a Smaller Number

The 4% safe withdrawal rate (also called the 25× rule) was derived from US market data: withdraw 4% of your corpus annually and it historically sustains 30 years. For India, given higher inflation (6% vs 3%), lower dividend yields and different market volatility, a more conservative 3–3.5% withdrawal rate (28–33× annual expenses) is advisable. Our calculator uses a dynamic model — the real rate of return minus inflation — rather than a fixed 4%, making it more accurate for Indian market conditions.

Why Delay Is Devastatingly Expensive

Consider three people targeting the same ₹5 crore corpus at age 60, investing at 12% CAGR. Starting at age 25: needs ₹7,200/month. Starting at age 35: needs ₹22,400/month — 3× more. Starting at age 45: needs ₹80,000/month — 11× more. Each decade of delay roughly triples the required monthly investment. No other financial decision has this kind of leverage. Use our SIP Calculator to plan the right mutual fund SIP to reach your corpus.

Building the Corpus — Which Instruments to Use

For the accumulation phase (working years): equity mutual funds via SIP are the most efficient — historically 12–15% CAGR long-term. Supplement with PPF for tax-free guaranteed returns (7.1%), and NPS for additional 80CCD tax benefit. As you approach retirement (5–10 years away), gradually shift from equity to hybrid and debt funds to protect your corpus from a market downturn just before retirement — called sequencing risk.

Decumulation — Making the Corpus Last

Having the corpus is only half the problem — making it last 25–30 years is the other half. A Systematic Withdrawal Plan (SWP) from a balanced or equity hybrid fund is the most tax-efficient income strategy — each redemption is partly principal (tax-free) and partly gains (taxed at 12.5% LTCG). Keep 2–3 years of expenses in a liquid fund as a buffer so you never have to sell equity during a downturn. Avoid annuities unless you specifically want guaranteed income, as they offer poor inflation protection. Plan your SWP strategy using our SWP Calculator.

✓Verified by ToollyX Team · Last updated June 2026