SWP withdrawal calculator:
how long will your corpus last

How a systematic withdrawal plan works

A systematic withdrawal plan (SWP) takes a fixed amount from your investment at regular intervals, usually each month. You decide the amount and the date, and the fund sells enough units to pay it.

While you withdraw, the remaining money keeps earning or losing. Each month the balance grows by the return and then falls by the withdrawal. If the return on the balance is larger than the withdrawal, the fund grows. If it is smaller, the balance shrinks and eventually runs out.

Most plans pay a fixed rupee amount each month, which is what this guide models. Some pay a fixed percentage of the balance instead. A fixed percentage can never run out, but the monthly income rises and falls with the market.

An SWP calculator answers two questions: what is left after a given number of years, and how long the money will last. Both depend on a return you can only assume.

SWP balance and duration formulas

The condition in the second formula is the one to remember. P × i is the interest your balance earns each month at the start. A withdrawal below it leaves the capital intact; a withdrawal above it spends capital every month.

Example: ₹10,00,000 with ₹8,000 a month at an assumed 6%

Because the ₹8,000 withdrawal is more than the ₹5,000 interest the balance earns at the start, capital falls every month. The balance is about ₹9,62,993 after one year, ₹7,90,690 after five, ₹5,08,362 after ten and ₹1,27,544 after fifteen.

The decline speeds up as the balance shrinks, because there is less money left to earn interest. The last few years of an SWP are usually where the fund drops fastest.

How long the money lasts at different withdrawals and returns

To read the table, find your monthly withdrawal in the first column, then choose the return you can defend rather than the one you would like. If the plan only lasts long enough in the 8% column, it is a fragile plan.

Look down a column and see how sharply the duration falls as you withdraw more. At 6%, taking ₹6,000 a month lasts nearly 30 years, but ₹10,000 a month lasts only about 11 years and 7 months.

Two changes stretch a fund. Lowering the withdrawal from ₹8,000 to ₹7,200 at 6% extends the life from about 16 years 5 months to about 19 years 10 months. Starting with ₹12,00,000 instead of ₹10,00,000 at ₹8,000 a month lasts about 23 years.

The 0% column is a useful floor: it is simply the fund divided by the withdrawal, so ₹10,00,000 ÷ ₹8,000 is 125 months, or about 10 years and 5 months, even if the fund earns nothing.

Why the order of returns matters

A calculator uses a steady return, but markets deliver uneven returns. When you are withdrawing, a bad year early hurts more than a bad year late, because you sell units at low prices to pay yourself, and those units are then missing when the market recovers.

Both paths average a 5% return, yet path A ends at ₹5,58,682 and path B at ₹7,62,586. The difference comes entirely from the order. That is why a steady-return calculator can look reassuring while a real plan is more fragile.

Some planners deal with this by keeping a year or two of withdrawals in a stable option, so they do not have to sell a falling fund. That is a choice about risk, not a way to get a better return, and it has its own cost in lower growth.

Setting a withdrawal you can sustain

Start from P × i. At an assumed 6%, ₹10,00,000 earns about ₹5,000 a month, so a withdrawal near that level keeps the capital steady. Taking ₹8,000 means starting at a 9.6% yearly withdrawal rate, which is more than the assumed return and so spends capital.

Inflation is the other test. If you raise the ₹8,000 by 5% a year, the same fund at an assumed 6% lasts about 11 years and 5 months instead of 16 years and 5 months. A plan that ignores rising costs looks better on paper than it feels in year ten.

You can also ask how big a fund must be. To pay ₹8,000 a month for 20 years at an assumed 6%, you would need about ₹11,16,646 at the start. For 25 years the figure is about ₹12,41,655 and for 30 years about ₹13,34,333, because the extra years are paid mostly from growth.

Mistakes with SWP planning

Most SWP plans fail quietly, through a handful of habits rather than one big error.

• Planning on the average return without considering a poor first few years.
• Withdrawing a fixed amount for decades without allowing for inflation, which raises what you need each year.
• Forgetting that each withdrawal includes some capital gain, so tax rules on gains may apply; check the current rules.
• Ignoring exit loads and expense ratios, which reduce the fund's return.
• Treating the withdrawal date as free of cost; selling units after a fall locks in the lower price.

Review the plan once a year. If the balance is running below your projection, a modest cut in the withdrawal early on does far more than a large cut late, because it protects the capital that has to keep earning.