SWP Calculator: How Long Will ₹1 Crore Last You?

A Systematic Withdrawal Plan (SWP) turns a lump sum into a monthly income: you invest a corpus in a mutual fund, and a fixed amount is redeemed into your bank account every month. The question every retiree asks is the same — how long will the money actually last? The answer is one comparison, run month after month: what your corpus earns versus what you withdraw. Get it right and an SWP can pay you for decades. Get it wrong and the same corpus can run dry years early. At an assumed steady 8% annual return, a ₹1 crore corpus paying a fixed ₹50,000 a month never runs out on paper — the first month's growth alone is about ₹66,667, more than the withdrawal. Raise the withdrawal every year by 6% to keep up with inflation, and the same ₹1 crore lasts about 21.5 years. Withdraw ₹75,000 a month with no step-up, and it lasts about 27.5 years. These are illustrations at a steady assumed return, not predictions — real returns vary, and a bad first few years hurt an SWP more than a bad later few years.

What an SWP actually does

An SWP is the mirror image of an SIP. An SIP puts money in every month; an SWP takes money out every month. You choose the fund, the amount and the date, and units worth that amount are redeemed into your bank account each month. Two things happen at once. The money you take out leaves the corpus. The money left behind keeps earning market returns. Whether the corpus grows or shrinks depends entirely on which of those two is bigger in a given month. Most funds let you start an SWP from an existing investment, and you can usually change the amount or stop it. It is a facility, not a separate product — the fund, its risk and its returns stay the same.

The one test: withdrawal vs monthly growth

Before any calculator, run this one test: divide your corpus by 150, roughly the monthly growth at 8% a year. Corpus ₹1 crore at 8%: monthly growth is about ₹66,667. Corpus ₹50 lakh at 8%: monthly growth is about ₹33,333. Corpus ₹25 lakh at 8%: monthly growth is about ₹16,667. If your monthly withdrawal is below that number, the corpus grows even as you draw from it — on a steady-return assumption. If it is above that number, the corpus shrinks every month, and the only question is how fast. This test is why small differences matter so much. A ₹50,000 withdrawal from ₹1 crore sits below the ₹66,667 growth line. A ₹75,000 withdrawal sits above it — and that single change turns "lasts indefinitely" into "lasts about 27.5 years".

The worked numbers at 8% return

All figures assume a steady 8% annual return, month-end withdrawals, and no tax or charges. Real returns are lumpy — treat these as illustrations, not promises. ₹1 crore, ₹50,000 a month, no step-up: never depletes on paper. Total withdrawn over 20 years would be ₹1.2 crore — more than you started with — because growth outpaces the withdrawal. ₹1 crore, ₹75,000 a month, no step-up: lasts about 27.5 years (331 months). ₹50 lakh, ₹40,000 a month, no step-up: lasts about 22.5 years (270 months). ₹1 crore, ₹50,000 a month, stepped up 6% a year: lasts about 21.5 years (258 months). Inflation adjustment is what turns a "never-ending" SWP into a finite one. The lesson: the withdrawal rate, not corpus size alone, decides the outcome.

The step-up trap

A fixed ₹50,000 a month sounds comfortable today, but in 15 years at 6% inflation it buys roughly what ₹20,800 buys today. That is why most retirees step their withdrawal up each year. But stepping up is expensive in corpus terms. At a 6% annual step-up, a ₹50,000 withdrawal becomes about ₹89,500 a month by year 10 and about ₹1,20,000 a month by year 15. The corpus must fund a withdrawal that keeps growing while its own growth stays proportional to its balance. Run both versions before you commit: the fixed version tells you the best case, and the stepped-up version tells you the honest case. If the stepped-up version runs out before you need it to, the fix is to start smaller, not to hope for higher returns.

Try it yourself with the SWP calculator

Use the live calculator below to test your own numbers — corpus, monthly withdrawal, expected return and annual step-up.

Try three runs: your planned withdrawal, your planned withdrawal with a 6% step-up, and a withdrawal 20% lower. If only the third version lasts as long as you need, that tells you the gap to close — by saving more or spending a little less in the early years.

Tax in one paragraph

Only the gains portion of each SWP withdrawal is taxed, not the full amount — one reason SWPs can beat fixed deposits on post-tax income for many investors. For equity-oriented funds, gains on units held over 12 months are generally taxed as long-term capital gains at 12.5% above ₹1.25 lakh of such gains a year; shorter holdings are taxed at 20%. Debt-fund rules differ, so check the current rules or speak to a tax professional before relying on any figure here.

Three mistakes that empty an SWP early

First, starting too high. A withdrawal above 6% of the corpus a year leaves little margin for a market fall in the first few years. Second, ignoring inflation — a fixed withdrawal quietly halves in real terms over about 12 years at 6% inflation. Third, redeeming extra during a crash, which locks in the fall and removes the units that would have recovered.

Your 5-minute SWP checklist

1. Run the one test: is your withdrawal below your corpus divided by 150 at 8%? 2. Run the stepped-up version, not just the fixed version. 3. Keep 12 to 24 months of withdrawals in a low-volatility fund or deposit, so a market fall does not force redemptions at the worst moment. 4. Review once a year: if the corpus fell sharply, trim the step-up for a year rather than raising the withdrawal anyway. Educational content only — not financial advice. Consult a SEBI-registered investment adviser for personal guidance; investments are subject to market risk. Sources: SWP worked figures: author's calculations at a steady 8% annual return, monthly compounding, month-end withdrawals. SWP mechanics and tax framing: standard mutual-fund SWP facility descriptions and current capital-gains rules for equity-oriented funds.