SWP Calculator (India) – Systematic Withdrawal Plan with Tax & Inflation

Use this SWP Calculator (India) to plan your Systematic Withdrawal Plan from mutual funds. Instantly estimate monthly withdrawal amount, remaining corpus, total withdrawal, and growth after returns and tax assumptions—perfect for retirement income planning.

Systematic Withdrawal Plan Calculator + Inflation Visualizations

Visualize inflation's impact on withdrawals, purchasing power, and investment growth

Inflation-adjusted withdrawals Purchasing power decay Real vs Nominal comparison Equity / Debt tax modes

Initial Investment (₹)

₹10,00,000

Initial Monthly Withdrawal (₹)

₹50,000

This amount will increase annually with inflation to maintain purchasing power

Expected Annual Return (%)

10%

Time Period (Years)

20 years

Withdrawal Frequency

Nominal Return

10%

Real Return

4.0%

Expected Annual Inflation (%)

India's long-term average: 5-7%. Inflation reduces purchasing power over time.

Increase withdrawals annually with inflation

If checked, withdrawal amount increases each year by inflation rate to maintain purchasing power

Tax & Duties (India)

Instrument Type (for taxation)

Tax Slab (used for Debt slab-tax)

SWP Start (for FY-wise LTCG exemption)

Start Month

Start Year

Apply 4% Health & Education cess on tax

Apply MF stamp duty 0.005% on purchase (reduces units)

Visualization Tips: Use the chart toggles above each graph to switch between different views of inflation impact, withdrawal growth, and purchasing power decay.

Net Cash Received (after tax + STT)

₹0

What you actually receive in-hand (nominal)

Gross Withdrawals

₹0

Final Corpus

₹0

Total Tax (CG)

₹0

Total STT

₹0

Real Return (after inflation)

Nominal return adjusted for inflation

Withdrawal Sustainability

—

Years your corpus can support at current purchasing power

Last Year's Withdrawal

₹0

Purchasing Power Loss

Inflation Impact Summary:

Calculating...

Inflation Impact Visualizations

Visualize how inflation affects withdrawals, purchasing power, and investment growth over time. Use toggles to switch between different views.

Withdrawal Growth Over Time

Actual bank deposits Purchasing power

Purchasing Power Decay

Value erosion Money lost to inflation

Corpus: Nominal vs Real

Nominal value Real value

Inflation Impact Dashboard

Real return Power loss

The Silent Killer in Retirement Planning: Inflation

Most SWP calculators fail you because they ignore inflation—this one doesn't. It shows you real purchasing power, not just nominal numbers. Your ₹50,000 today ≠ ₹50,000 in 2035.

Inflation-adjusted withdrawals Real vs Nominal returns Purchasing power decay Post-tax reality

1) The Inflation Reality Check

Monthly Withdrawal: The Dangerous Assumption

If you enter ₹50,000 and DON'T check "Increase withdrawals with inflation", you're planning to live on ₹50,000 forever. But in 20 years at 6% inflation, that ₹50,000 buys what ₹15,500 buys today. Your purchasing power drops by 69%.

Expected Inflation Rate: The Silent Tax

India's long-term average: 5-7%. At 6% inflation, prices double every 12 years. Your ₹1 crore corpus in 2045 has only ₹31 lakhs of today's purchasing power. This is why your grandparents' ₹10,000 monthly pension seems tiny today.

6% = prices double every 12 years Inflation compounds silently

The Critical Toggle: Inflation Adjustment

✓ ON (Recommended): Withdrawals increase annually to maintain lifestyle. You withdraw ₹1.6L/month in Year 20 to equal ₹50,000 today's purchasing power. Your corpus needs to support exponential growth.

✗ OFF (Dangerous): You live on fixed ₹50,000 forever. Your lifestyle gradually declines as prices rise. By Year 20, your ₹50,000 buys what ₹15,500 buys today. Most retirees regret this choice.

Real Return: What Actually Matters

10% nominal return with 6% inflation = only 3.8% real return. This is your actual wealth growth after inflation eats its share. Formula: [(1.10 / 1.06) - 1] × 100 = 3.77%

Critical insight: You need 4-6% real return to maintain lifestyle while withdrawing. Below 3% real return, you're slowly going broke.

Visualize the Erosion

Use the chart toggles to see how ₹1 loses value over time. The "Purchasing Power Decay" chart shows the brutal truth most investors ignore. At 6% inflation: Year 5 → ₹0.75, Year 10 → ₹0.56, Year 20 → ₹0.31

2) Tax Reality in an Inflationary Economy

Why Debt Funds (post 2023) Hurt in High Inflation

Debt funds purchased after April 1, 2023 are taxed at your slab rate (up to 30%)—with NO indexation benefit. In high inflation years, you pay tax on nominal gains (including inflation), not real gains. This can wipe out 30-50% of your actual returns.

No inflation adjustment in tax Tax on illusory gains Real return can turn negative

Equity's Built-In Inflation Protection

Equity's 12.5% LTCG rate (above ₹1.25L annual exemption) works better in inflation. Companies can raise prices with inflation, so equity returns often outpace inflation—giving you real growth to tax. Historical data: Indian equities have beaten inflation by 4-7% over 20+ year periods.

The Double Whammy

Inflation forces you to withdraw more (to maintain lifestyle) → creates more capital gains → increases your tax bill. Example: Year 1 withdrawal ₹6L creates ₹2L capital gains. Year 20 withdrawal ₹19.2L creates ₹7L capital gains. Your tax liability triples even though lifestyle stays same.

STT & Stamp Duty: Fixed Costs in a Rising World

These costs stay percentage-based. As your withdrawals grow with inflation, these transaction costs grow proportionally—eating 0.001%-0.1% of each withdrawal. Over 20 years, can add up to ₹50,000-₹2,00,000 in total costs.

Real After-Tax Return: The Only Number That Matters

Formula: (Nominal Return - Inflation) - Tax Impact. Example: 10% return - 6% inflation = 4% real return. After 15% effective tax → 3.4% real after-tax return. Most investors only look at nominal 10% and wonder why they're falling behind.

3) Results: The Truth Behind the Numbers

Net Cash Received (Nominal vs Real)

Nominal: The actual rupees hitting your bank account (₹1.2 crore over 20 years).
Real (Inflation-adjusted): What those rupees can actually buy in today's terms (₹65 lakhs purchasing power). If your ₹1.2 crore nominal has only ₹65L real value—you've lost 46% to inflation.

The Critical Metric: Real Return

This tells you if you're actually growing wealth or just treading water.

＞5%: Excellent - Building real wealth, lifestyle secure
3-5%: Good - Maintaining purchasing power with buffer
1-3%: Warning - Barely keeping up, risky in bad years
＜1%: Danger - Getting poorer in real terms, plan failing
Negative: Crisis - Wealth destruction, immediate action needed

Last Year's Withdrawal: The Lifestyle Reality Test

Look at Year 20's withdrawal amount. If inflation-adjusted: ₹50,000 → ₹1.6L/month. Can your corpus support this? The "Withdrawal Growth" chart shows if you're planning for reality or fantasy. Pro tip: If Year 20 withdrawal exceeds 8% of final corpus, plan is unsustainable.

Purchasing Power Loss: The Silent Wealth Destroyer

This percentage shows how much inflation has eroded your money over time:
• 6% inflation, 10 years: 44% loss (₹1 → ₹0.56)
• 6% inflation, 20 years: 69% loss (₹1 → ₹0.31)
• 7% inflation, 20 years: 75% loss (₹1 → ₹0.25)
Your entire strategy must overcome this erosion PLUS generate returns for withdrawals.

The Inflation Gap: Money Lost Forever

The difference between Nominal corpus (₹80L) and Real corpus value (₹50L) = ₹30L inflation gap. This ₹30L is purchasing power inflation has stolen from you. Cannot be recovered. Good planning minimizes this gap through higher real returns. Target: Keep inflation gap below 35% of nominal corpus.

4) Building Inflation-Resistant Withdrawals

Most retirement plans fail because they use today's expenses, not tomorrow's prices. Here's how to build resilience:

Always inflation-adjust withdrawals Target 5%+ real returns Watch inflation gap quarterly Stress test with 8% inflation

✓ Strategy A: Inflation-Adjusted Withdrawals (RECOMMENDED)

How it works: Start with ₹50,000/month, increase by actual inflation each year. In Year 20, you withdraw ₹1.6L/month to maintain exact same lifestyle.

Reality check: Your corpus must support exponential growth. Requires:
• 60-70% equity allocation for growth
• Real returns of 4%+ minimum
• Initial corpus 20-25x annual withdrawal

Who it's for: Anyone who doesn't want lifestyle compromise. 95% of successful retirees use this.

⚠ Strategy B: Fixed Withdrawals + Declining Lifestyle

How it works: Keep withdrawals fixed at ₹50,000. Accept that in Year 10, it buys only ₹28,000 worth. In Year 20, only ₹15,500 worth.

Reality check: Your standard of living drops 44% in 10 years, 69% in 20 years. You'll need to:
• Supplement with pension/rental income
• Gradually reduce expenses (smaller home, less travel)
• Accept lifestyle decline

Who it's for: Those with guaranteed pensions covering 60%+ expenses, or who plan to drastically reduce spending. High risk of regret.

⚙ Strategy C: Dynamic Withdrawal Rate (Advanced)

How it works: Withdraw 4% of current portfolio value annually (inflation-adjusted percentage). If portfolio grows → withdrawals grow. If portfolio falls → you cut back.

Reality check:
• Good years (15% return): Withdraw 4% = lifestyle upgrade
• Bad years (0% return): Withdraw 4% = lifestyle cut
• Requires emotional discipline and flexibility

Who it's for: Sophisticated investors comfortable with variable income who can adapt spending. Highest long-term success rate but hardest to execute.

Test: 4% inflation scenario Test: 8% inflation scenario Test: 3% returns (crash)

🔥 How to Beat Inflation: The 5 Pillars of Inflation-Proof Wealth

🎯

Pillar 1: Equity-Heavy Allocation

Why it works: Equities are ownership in businesses that can raise prices with inflation. Over 20+ years, Indian equities have delivered 12-15% returns vs 6% inflation.

The Magic Formula:
• Age 50-60: 70% equity, 30% debt
• Age 60-70: 60% equity, 40% debt
• Age 70+: 50% equity, 50% debt

Real example: ₹1Cr with 70% equity earning 12% + 30% debt earning 7% = 10.5% blended return
At 6% inflation → 4.2% real return (enough to sustain inflation-adjusted withdrawals)

Action Step: If your debt allocation > 40% and you're under 65, you're losing to inflation. Shift to equity-oriented balanced funds or index funds.

📈

Pillar 2: Built-in Inflation Escalation

Why it works: Your brain cannot intuitively grasp exponential inflation. Automating annual increases ensures you don't fall behind.

Implementation:
• Year 1: ₹50,000/month
• Year 2: ₹50,000 × 1.06 = ₹53,000
• Year 3: ₹53,000 × 1.06 = ₹56,180
• Year 10: ₹89,542
• Year 20: ₹1,60,357

Calculator setup: Always check ✓ "Increase withdrawals annually with inflation"

The harsh reality: If you DON'T do this, your Year 20 ₹50,000 is worth only ₹15,500 in today's terms. That's a 69% lifestyle cut most people can't handle.

Action Step: Set up annual SWP review every April. Increase withdrawal by previous year's actual CPI inflation (not assumed 6%).

💰

Pillar 3: Tax-Efficient Withdrawals

Why it works: Every rupee saved in tax is a rupee that compounds to fight inflation. Tax drag can reduce real returns by 1-2% annually.

The Strategy:
• Use equity mutual funds/ETFs for LTCG 12.5% rate
• Utilize ₹1.25L annual LTCG exemption per FY
• Avoid debt funds (30% slab tax)
• Consider tax-harvesting yearly

Real impact:
Scenario A (Poor tax planning):
Debt fund, 7% return, 30% tax → 4.9% post-tax → -1.1% real return (after 6% inflation) = Wealth destruction

Scenario B (Good tax planning):
Equity fund, 12% return, 12.5% effective tax → 10.5% post-tax → +4.2% real return = Wealth preservation

Action Step: Calculate your effective tax rate on withdrawals. If > 15%, restructure to equity-oriented products. Use this calculator's tax comparison feature.

🛡️

Pillar 4: Inflation Shock Absorber

Why it works: Inflation isn't steady 6%. It spikes (2022: 7.8%, 2010: 12%). You need buffer for bad years without selling equity in crashes.

The 3-Bucket System:
Bucket 1 - Cash (1 year expenses):
Keep ₹6L in savings account. Refill annually. No market risk.

Bucket 2 - Short-term debt (2 years expenses):
₹12L in liquid/ultra-short funds. Refill every 6 months.

Bucket 3 - Growth (remaining corpus):
Everything else in equity funds for long-term inflation beating.

Example with ₹1Cr:
• Bucket 1: ₹6L (cash)
• Bucket 2: ₹12L (debt)
• Bucket 3: ₹82L (equity)

This gives you 3 years to ride out market crashes + inflation spikes without panic selling.

Action Step: If 2008/2020 crash + 8% inflation hit tomorrow, do you have 3 years of expenses in non-equity? If no, create buckets now.

📊

Pillar 5: Quarterly Inflation Checkups

Why it works: Inflation changes. Your 6% assumption might be 8% reality. Early detection prevents disaster.

The Quarterly Review Process:

Every 3 months, check these 4 metrics:

1. Real Return: Actual portfolio return - actual inflation
Target: > 4% | Warning: < 2% | Danger: Negative

2. Inflation Gap: (Nominal corpus - Real corpus) ÷ Nominal corpus
Target: < 30% | Warning: 30-40% | Danger: > 40%

3. Withdrawal Rate: Annual withdrawal ÷ Current corpus
Safe: < 4% | Risky: 4-6% | Unsustainable: > 6%

4. Sustainability Buffer: Corpus ÷ Current annual withdrawal
Safe: > 15 years | Warning: 10-15 years | Danger: < 10 years

Action Step: Use this calculator quarterly with updated values. If 2+ metrics in danger zone, immediately: (a) reduce withdrawal 10%, or (b) shift 10% corpus to equity, or (c) delay retirement 2 years.

🎓 Advanced Inflation-Beating Tactics for Experts

1. Geographic Inflation Arbitrage

Concept: Healthcare/housing inflation in metros (8-10%) > small towns (4-6%). Relocate to lower-inflation region, maintain same lifestyle with 30% less withdrawal.

Real example: ₹80,000/month in Bangalore = ₹55,000/month in Coimbatore (same quality of life). Saves ₹3L/year = extends corpus by 5+ years.

2. Inflation-Indexed Instruments

Concept: Some bonds/schemes have returns linked to inflation. Consider Inflation-Indexed Bonds (IIBs) for 10-15% of debt allocation.

How they work: If inflation = 7%, your principal + interest both increase by 7%. Automatic inflation protection built-in. Currently rare in India but watch for new issues.

3. International Diversification

Concept: If rupee loses 3% annually vs dollar + Indian inflation is 6% = 9% erosion. Hold 15-20% portfolio in international equity funds for currency hedge.

Real benefit: When rupee weakens (₹75 → ₹83), your dollar assets automatically appreciate 10.6% in rupee terms, offsetting inflation.

4. Dynamic Asset Allocation Rules

Concept: When inflation < 5%, hold 60% equity. When inflation > 7%, increase to 75% equity (equities protect better in high inflation).

Rebalance trigger: Every 6 months, if actual CPI is 2%+ different from your assumption, rebalance equity allocation accordingly.

5. Dividend Growth Investing

Concept: Blue-chip dividend stocks that increase dividends 10-12% annually. Your "withdrawal" grows automatically with company profits (which rise with inflation).

Example: Invest in dividend aristocrat funds. As companies raise dividends with inflation, your income stream naturally inflation-adjusts without selling units.

6. Real Estate Income Strategy

Concept: If 20% of corpus in rental property, rent rises with inflation (typically 5-8% annually). Provides natural inflation hedge + withdrawal supplementation.

Math: ₹40L property giving ₹20,000/month rent. Rent grows 6%/year naturally. Reduces pressure on equity corpus by ₹2.4L/year.

How to Read the Charts: Visualizing Inflation's Impact

Numbers tell one story, charts tell the whole truth. Use the toggles above each chart to see different perspectives of your plan. Most people only look at nominal values and wonder why they're struggling—charts reveal the hidden inflation damage.

Chart 1: Withdrawal Growth Over Time

Blue line (rising) = Your actual bank deposits each year

Orange dashed line (flat) = What that money can buy in Year 1 terms

Gray horizontal line = Your Year 1 lifestyle baseline

💡 Key Insight:

If blue rises but orange stays flat → you're maintaining lifestyle ✓
If orange falls below gray → you're cutting lifestyle ✗
The gap between blue and orange = inflation's theft

Chart 2: Purchasing Power Decay

Red declining curve = Value of ₹1 over time (starts at 1.00, ends at 0.31)

Blue bars = Nominal withdrawal amount

Orange bars = Real purchasing power of that withdrawal

Red shaded area = Purchasing power destroyed by inflation

⚠️ Key Insight:

This is inflation's brutal compounding effect. Watch the red curve drop—at 6%, your money loses value exponentially. By Year 20, your ₹1L is worth only ₹31K of Year 1 purchasing power. Plan must overcome this.

Chart 3: Corpus: Nominal vs Real

Blue area/line = Your portfolio value in rupees (what broker shows)

Orange area/line = What that portfolio can actually buy today

Red bars (Inflation Gap view) = Purchasing power lost—cannot be recovered

🎯 Key Insight:

Your ₹80L portfolio might look healthy (blue), but orange shows it's worth only ₹50L in today's terms. That ₹30L gap (red) = wealth inflation stole forever. Target: Keep gap < 35% of nominal value. If > 45%, plan is failing.

Chart 4: Inflation Impact Dashboard

Green bar = Real return % (positive = wealth growing)

Red bar = Purchasing power lost % (lower is better)

Orange bar = How much withdrawals must increase %

Purple bar = Total inflation erosion in rupees

📊 Key Insight:

One-glance health check:
• Green > 4% → ✓ Good
• Red < 50% → ✓ Acceptable
• Orange < 200% → ✓ Manageable
If 2+ metrics fail, plan needs immediate revision.

Using the Chart Toggles: Three Essential Views

📱 Nominal View (Bank Statement)

Shows actual rupees in your account. Use this to verify: "Will my bank show these deposits?" Good for matching expectations with reality.

🛒 Real View (Grocery Store)

Shows purchasing power in today's terms. Use this to ask: "Can I actually buy groceries/medicine/rent with this?" This is REALITY—not nominal numbers.

⚖️ Comparison View (Truth Revealer)

Side-by-side nominal vs real. Shows the exact gap inflation creates. The wider the gap, the more inflation is destroying your wealth. Most painful but most honest view.

⚠️ Critical Habit: Always start with "Real View" when planning lifestyle. Then check "Nominal View" to see the rupee amounts. Most people do the opposite and get shocked when they realize ₹2L/month in Year 20 = ₹62K purchasing power. Don't be that person.

Withdrawal Sustainability: The Most Misunderstood Metric

🚨 STOP: Read This First or You'll Misunderstand Everything

❓ The Confusing Question Everyone Asks:

"I entered 20 years in Time Period. Results show Sustainability: 15+ years.
Does this mean my money lasts 20+15 = 35 years total? Or only 15 years total?"

✅ THE ANSWER: It Lasts 20+15 = 35 Years Total

Here's what actually happens:

Years 1-20: You execute your withdrawal plan as designed.
• You withdraw money every month/quarter/year
• Your corpus grows with returns
• Your withdrawals increase with inflation (if toggle ON)
• After 20 years, you still have ₹60L left (Final Corpus)

Year 21 onwards (The "Sustainability" part):
• You still have ₹60L corpus remaining
• Calculator asks: "If returns become ZERO from Year 21, how long can this ₹60L last?"
• At Year 20's withdrawal rate (₹4L/year), ₹60L ÷ ₹4L = 15 more years
• So: Years 1-20 (planned) + 15 years (buffer) = 35 years total

🎯 Real-World Example to Make It Crystal Clear:

Your Input:
• Initial Investment: ₹1 Crore
• Monthly Withdrawal: ₹50,000
• Time Period: 20 years
• Return: 10% | Inflation: 6%

What Calculator Simulates (Years 1-20):
• Year 1: Withdraw ₹6L (₹50K × 12)
• Year 10: Withdraw ₹10.7L (inflation-adjusted)
• Year 20: Withdraw ₹19.2L (inflation-adjusted)
• After all 20 years of withdrawals: ₹60L corpus remains

What "Sustainability: 15+ years" Means:
• This ₹60L can support 15 MORE years of withdrawals
• Even if market crashes and returns become 0%
• At Year 20's lifestyle (₹19.2L/year adjusted)
• Total longevity: 20 + 15 = 35 YEARS

Translation in Plain English:
"Your plan works for 20 years as designed. Even after that, you have enough buffer to survive 15 more years if everything goes wrong. Total safety: 35 years from today."

📅 Visual Timeline: Where Does Each Year Fit?

📍 YEARS 1-20: Your Active Withdrawal Plan Period

This is the "Time Period" you entered in the calculator.
• You're actively managing withdrawals
• Corpus is growing with returns (10%)
• Withdrawals increasing with inflation (6%)
• You're living your planned retirement lifestyle
Status: Everything is going according to plan ✓

⏰ END OF YEAR 20: The Checkpoint

You've withdrawn all planned amounts for 20 years.
Calculator now asks: "What's left in the tank?"
Remaining Corpus: ₹60,00,000 (Final Corpus shown in results)

📍 YEARS 21-35: Your Safety Buffer ("Sustainability")

This is the "Withdrawal Sustainability" metric (15+ years).
• This is EXTRA time beyond your 20-year plan
• Assumes ZERO returns from Year 21 onwards (worst case)
• Your ₹60L corpus can still support you for 15 more years
• At Year 20's withdrawal rate (₹4L/year inflation-adjusted)
Status: Emergency buffer if markets crash after Year 20 ✓

🎯 TOTAL COVERAGE: 35 YEARS (20 + 15)

Simple Math:
Planned Period (what you entered) + Safety Buffer (sustainability) = Total Protection
20 years + 15 years = 35 years of financial security

Real-world meaning: If you're 60 today, this plan protects you until age 95, even if markets collapse after age 80.

❌ Common Mistakes People Make (Don't Be This Person)

❌ Mistake #1: Adding the Numbers Wrong

Wrong thinking: "Calculator shows sustainability 15 years, so my money only lasts 15 years total."

Reality: Money lasts 20 years (your plan) + 15 years (buffer) = 35 years total. You're ADDING, not replacing.

❌ Mistake #2: Ignoring the "Final Corpus" Number

Wrong thinking: "Results show ₹60L final corpus. I lost ₹40L from my ₹1Cr!"

Reality: You WITHDREW ₹1.2Cr over 20 years AND still have ₹60L left. You didn't lose anything—you spent it on living!

❌ Mistake #3: Not Adjusting for Inflation

Wrong thinking: "Sustainability 15 years means I can keep withdrawing ₹50K/month for 15 more years."

Reality: By Year 20, you're withdrawing ₹1.6L/month (inflation-adjusted). Those 15 years are at ₹1.6L/month rate, not ₹50K/month!

✅ Quick Self-Test: Do You Really Understand?

Answer these questions honestly. If you get ANY wrong, re-read the sections above:

Q1: I enter "25 years" in Time Period. Results show "Sustainability: 12 years". What's my total coverage?
✓ Correct Answer: 25 + 12 = 37 years total protection
✗ Wrong Answer: "Only 12 years" or "Only 25 years"

Q2: Calculator shows "Final Corpus: ₹80L" after 20 years with ₹1Cr start. Where did ₹20L go?
✓ Correct Answer: Nowhere! You withdrew MORE than ₹20L (maybe ₹1.5Cr total over 20 years), but corpus GREW to compensate, leaving ₹80L remaining.
✗ Wrong Answer: "I lost ₹20L to fees/market"

Q3: Results show "Sustainability: 5 years". Is this good or bad for a 60-year-old planning 20-year retirement?
✓ Correct Answer: VERY BAD. Total coverage is only 20+5 = 25 years (until age 85). Average Indian lives to 70+, many to 80-90. You're at high risk. Need 10+ year buffer minimum.
✗ Wrong Answer: "5 years is fine" or "It's good, money lasts"

Q4: Withdrawal starts at ₹50K/month. After 20 years with inflation, it's ₹1.6L/month. Sustainability shows 10 years. How much do I withdraw in those 10 buffer years?
✓ Correct Answer: ₹1.6L/month (continues at Year 20's inflation-adjusted rate). Total = ₹1.92Cr over those 10 years.
✗ Wrong Answer: "₹50K/month" or "₹1L/month average"

🎯 Scoring:
• 4/4 correct: You understand! Proceed with planning. ✓
• 2-3 correct: Re-read the sustainability section carefully.
• 0-1 correct: STOP. Don't make investment decisions until you understand this completely. Misunderstanding sustainability can cost you lakhs.

How It's Calculated

Formula: Final Corpus ÷ Current Annual Withdrawal

Example:
Final Corpus: ₹60,00,000
Monthly Withdrawal (Year 1): ₹50,000
Annual Withdrawal: ₹50,000 × 12 = ₹6,00,000
Sustainability: 60,00,000 ÷ 6,00,000 = 10 years buffer

This tells you: "If returns go to ZERO tomorrow, I can still live for 10 years."

What It Assumes (The Hidden Gotchas)

1. Zero future returns – Ultra-conservative worst-case
2. Fixed withdrawals – Doesn't account for inflation increase
3. No market crashes – Assumes you can liquidate anytime
4. No taxes – Just principal, ignores capital gains tax

Reality: This is a stress-test buffer, not a prediction. If sustainability < 10 years, you are one market crash away from crisis.

How to Interpret Correctly

🔴 Red Zone (<5 years): EMERGENCY
Action: Cut withdrawals 20% immediately or add ₹20L+ to corpus

🟡 Yellow Zone (5-10 years): WARNING
Action: Reduce withdrawals 10% or shift 15% to equity

🟢 Green Zone (10-20 years): SAFE
Your plan has good buffer against shocks

🔵 Blue Zone (20+ years): CONSERVATIVE
Consider: You could withdraw more or retire earlier

⚠️ The Inflation Adjustment Reality Check

Critical Point: If you're increasing withdrawals with inflation, your Year 20 lifestyle is MUCH more expensive than Year 1.

Example:
Year 1: ₹50,000/month (₹6L annual)
Year 20: ₹1,60,000/month (₹19.2L annual) — at 6% inflation

Sustainability using Year 1 amount: 60L ÷ 6L = 10 years ✓
Actual sustainability at Year 20 lifestyle: 60L ÷ 19.2L = 3.1 years ⚠️

The Harsh Truth: When inflation-adjusting withdrawals, mentally divide sustainability by 3 for 20-year plans, by 2 for 10-year plans. If result < 5 years, plan is at risk.

🚨 Final Reality Check: Stress Test Your Plan NOW

Step 1: Run calculator with your current assumptions (6% inflation, 10% return).
Step 2: Change to 8% inflation, 7% return (bad decade scenario). Does plan survive 20 years?
Step 3: Check if real return > 3%. If no, you're in danger zone.
Step 4: Look at Year 20 withdrawal amount. Can you actually imagine spending that much monthly? If not, your plan is fantasy.

The Brutal Statistics:
• 60% of Indian retirees run out of money before life ends
• 80% of retirement plans ignore inflation correctly
• Average retirement lasts 25 years, but people plan for 15
• Inflation alone destroys 69% of purchasing power in 20 years at 6%

Don't become a statistic. Use this calculator quarterly. Adjust when metrics go red. Always inflation-adjust withdrawals. Target 5%+ real returns. Keep 70%+ in equity under age 65. These aren't suggestions—they're requirements for avoiding poverty in old age.