SWP Calculator

It depends on the ratio of withdrawal to corpus and the return the remaining money earns. As a reference point: ₹20 lakh paying out ₹15,000 a month at a constant 8% annual return lasts about 27.6 years. If the annual withdrawal is smaller than the corpus's annual growth, the corpus never depletes and can even keep growing; once withdrawals outpace growth, depletion accelerates because each withdrawal shrinks the base that earns the return.

Each SWP installment is a redemption of units, and only the gain portion of each redemption is taxed — not the full withdrawal. For equity-oriented funds, gains on units held under 1 year are taxed at 20%, and gains on units held 1 year or more at 12.5% above a ₹1.25 lakh per-year exemption; units redeem oldest-first (FIFO). For debt funds, since April 2023 gains are taxed at your income-tax slab rate.

They differ in what is guaranteed. An FD pays a contracted interest rate and the principal is not market-linked; an SWP redeems from a market-linked corpus, so the income is only as durable as the corpus. An SWP from an equity or hybrid fund can beat FD interest and is often taxed more lightly, since only the gain in each withdrawal is taxed rather than the whole payout — but it carries the risk that a market fall depletes the corpus faster than planned.

A common reference is an annual withdrawal of 3–4% of the corpus, stepped up for inflation — roughly ₹25,000–₹33,000 a month from ₹1 crore. Rates in that range have historically survived long retirements in most market sequences, but no rate is safe in all of them; a constant-return calculator overstates safety because it ignores the risk of poor early years. The lower the withdrawal rate relative to the return, the more sequences the plan survives.

The simulation is capped at 50 years. When the withdrawal is small enough relative to the assumed return — specifically, when the corpus grows more each month than it pays out — the balance never falls, so the calculator reports "50+ years (never depletes)" and shows the balance still standing at the cap rather than a depletion date.