How much money do you need to retire comfortably?

Start with spending, not a multiple

Ask how much you need to retire and the usual answers are a round number: ₹1 crore, ₹5 crore, 25 times expenses. Each is someone else's answer to a question that depends on your spending, your retirement age and how long you will live.

The arithmetic is not complicated. It has four inputs, and the first one decides most of the answer:

1. What you will spend in the first year of retirement, in that year's rupees.
2. How many years the money has to last.
3. The return the corpus earns after you retire.
4. Inflation during retirement, which does not stop when your salary does.

Our guide to how much retirement corpus you need covers each input in detail. This post works one example through and checks the return assumption against what fund categories have actually delivered.

A worked example

Take a household spending ₹6 lakh a year today, planning to retire in 20 years.

Step 1: adjust today's spending. Subtract what stops at retirement: a home loan EMI that will be paid off, children's education, your own retirement savings. Add what starts or grows: health insurance premiums, medical costs, travel. Many households find these roughly cancel out; some find healthcare makes the number bigger.

Step 2: inflate it. At 6% inflation, prices roughly triple in 20 years. ₹6 lakh today becomes about ₹19.2 lakh a year at retirement. The inflation calculator does this step for any rate and horizon.

Step 3: divide by a withdrawal rate. The withdrawal rate is the share of the starting corpus you take out in year one, then raise with inflation each year.

A 4% rate is the familiar "25 times" rule. For a retirement at 60 lasting 30 years or more, 3.5% to 4% is a common planning range. For a retirement starting in your 40s, it needs to be lower, as FIRE in India explains.

The figure looks large because it is in future rupees. ₹5.5 crore in 20 years buys roughly what ₹1.7 crore buys today at 6% inflation.

Check the return assumption against real data

A withdrawal rate is only safe if the corpus earns enough above inflation. What matters is the real return: the return after inflation. A retiree's portfolio is usually more conservative than the one that built it, so it helps to know what conservative categories have actually returned.

Medians across Direct Growth plans with a 10-year record, from NAV data as of 1 October 2026. The real return assumes 6% inflation and is calculated as (1 + return) ÷ 1.06 − 1.

The table shows why a retirement portfolio held entirely in safe debt struggles. A liquid fund that returned 6.12% a year over the decade earned almost nothing after 6% inflation. A corpus earning a zero real return and paying out 3.5% a year runs out in under 30 years.

The categories with higher real returns came with deeper falls along the way: the median aggressive hybrid fund with a 10-year record fell about 29% from peak to trough at its worst, and the median flexi-cap fund about 37%. That is why most plans keep the next few years of spending in stable funds and the long-term money in equity.

These are past returns over one decade. The next decade can be better or worse.

Subtract what you already have

The target is not what you need to save from scratch. Subtract what is already coming:

• EPF balance at retirement, projected with the EPF calculator.
• NPS corpus, counting the portion that must buy an annuity as monthly income rather than capital.
• Gratuity, if you expect to complete the qualifying service.
• Property you plan to sell, not the home you will live in.
• Pension or rental income, which reduces the spending the corpus has to fund.

What is left is the gap your own investing has to close. The retirement calculator turns that gap into a monthly SIP.

Keep the health buffer separate

A retirement corpus sized for ordinary spending can be knocked off course by one hospital bill paid by selling equity in a bad year. Treat health insurance and a medical reserve as separate from the corpus, not as one of its uses. Healthcare costs in retirement explains why a single policy usually is not enough.

Recalculate every year

The number you calculate at 35 describes a person who no longer exists at 45. Spending changes, markets change, and inflation does not run at a neat 6%. Redoing the calculation once a year takes an hour and lets you adjust while changes are still cheap. Being at 40% of the target is a useful thing to know, and far more actionable than "I should save more".

This post is for education only and is not investment, tax or financial advice. Past returns do not predict future returns.