Retirement calculator: corpus and SIP from your expenses

What the retirement calculator answers

"How much do I need to retire?" has no answer until it is tied to spending. The retirement calculator starts from one figure you know, what you spend in a month today, and works out three things: what that spending will cost when you retire, the corpus that can pay it until your assumed life expectancy, and the monthly SIP that builds that corpus from now.

Why spending, and not income, is the right starting point is argued in how much money you need to retire comfortably. This post walks through the calculator itself.

The eight inputs

The three rates move in 0.5% steps, and each slider has a box for typing an exact value. If retirement age is not after your current age, or life expectancy is not after retirement age, the results are replaced by a note asking you to check the ages.

Two return rates exist for a reason. Money that nobody is drawing from can sit through a bad year in equity. Money paying your bills every month usually moves to debt and hybrid funds, which earn less, so the default after retirement is 7% rather than 12%.

What the three cards mean

With every default in place, the calculator shows:

• Expense at retirement: ₹2.87L. ₹50,000 grown at 6% a year for 30 years. This is what the same lifestyle costs a month at 60.
• Your FIRE number: ₹7.23Cr, labelled "corpus required at retirement". This is the smallest corpus that pays ₹2.87 lakh in the first month of retirement, raises the payment by 6% every year, earns 7% on whatever is left, and lasts until 85.
• Required monthly SIP: ₹20.48K. The flat monthly amount that grows to ₹7.23 crore in 30 years at 12%.

The corpus is found by running the whole 25-year drawdown and searching for the amount that just survives it, not by multiplying expenses by a rule of thumb. That makes the next figure worth reading.

The FIRE numbers panel

Under the cards, The FIRE numbers behind this plan shows four figures:

The panel also prints the plan's withdrawal rate in the first year of retirement: 4.8% at the defaults, which is ₹2.87 lakh × 12 divided by ₹7.23 crore. The page treats it as a result to compare against the familiar 4% guideline, not an input. FIRE and the 4% rule explains where that guideline comes from and why it was built on US data.

A worked example: adding what you already have

Keep the defaults and enter ₹10,00,000 as current investment. The first two cards do not change, because the target depends on spending, not savings. The SIP card drops to ₹10.30K, and a line appears under the cards: your ₹10 lakh grows to ₹3.59 crore by retirement, so the SIP only has to build the remaining ₹3.64 crore. Your existing money is grown at the pre-retirement return before the SIP is sized.

Since ₹10 lakh is less than the ₹20.11 lakh Coast FIRE figure, the panel still describes Coast FIRE as a target. Enter ₹21 lakh and it reports that you have reached Coast FIRE, and the SIP card shows ₹0.

Which assumption moves the answer most

Starting from the defaults, change one input at a time:

One extra point of inflation adds ₹3.46 crore to the target, because it raises the expense for 30 years before retirement and for 25 years during it. That is the input to set with the most care. The inflation calculator shows what a single rate does to a fixed sum over time.

The charts

Corpus: accumulation, then inflation-adjusted drawdown plots the build-up in nominal rupees and the drawdown in retirement-day rupees. That is why the line peaks at the required corpus and falls to zero at life expectancy, rather than rising far above it in nominal terms. The donut, What makes up the required corpus, splits the target into money you invest and estimated gain. At the defaults, that is ₹73.74 lakh of SIP instalments and about ₹6.49 crore of growth on them.

What the calculator assumes

1. Constant returns and one inflation rate. Real returns are uneven, and a fall in the first years of retirement does lasting damage. Sequence-of-returns risk explains why.
2. A flat SIP. The SIP never rises with your salary. A step-up SIP can reach the same target from a smaller start.
3. No tax, and returns net of fund costs. Enter returns after expense ratios.
4. Nothing else funds retirement. EPF, NPS or a pension are not separate inputs; adding their expected value to current investment is one way to include them.

Where it fits

The retirement calculator works backwards from spending. The financial freedom calculator works forwards from a SIP you choose and tests whether it lasts, and the SWP calculator checks a corpus you already have. For how the required SIP changes with the age you start, see how much to save for retirement at every age, and for a 40s retirement, what FIRE in India really takes. The inputs that dominate the number are discussed in how much do you actually need to retire?.

Run the retirement calculator once with your own spending and once with inflation a point higher. The gap between the two answers is the margin your plan needs. None of this is advice on what to invest in.