This SWP calculator shows what happens when you take a fixed amount out of a mutual fund every month through a systematic withdrawal plan. Set the corpus, the payout you want each month, a likely return and the period. It shows the balance left at the end, the total withdrawn and, if the money runs out, exactly when.
An SWP is the reverse of a SIP. People use SIPs to build a corpus and SWPs to draw an income from it, often in retirement. Many search for a SIP and SWP calculator together; this page covers the withdrawal half, and links to the building half.
At a glance
- Example₹20 lakh, ₹15,000 a month, 8%, 15 years
- Total withdrawn₹27,00,000
- Balance left₹14,23,270
- At ₹20,000 a monthMoney lasts 13 years 10 months
- Withdrawal rateYearly withdrawals ÷ corpus
- TaxOnly the gain part of each withdrawal is taxed
How the SWP calculator works
Each month the remaining balance grows at the expected return (yearly rate ÷ 12), then the withdrawal is taken out. If the withdrawal is less than the monthly growth, the balance keeps rising. If it is more, the balance shrinks, slowly at first and then faster.
With ₹20,00,000 at 8% and ₹15,000 a month, you take ₹1.8 lakh a year, 9% of the starting corpus. Over 15 years you withdraw ₹27 lakh and still have about ₹14.2 lakh left. Raise the withdrawal to ₹20,000 a month, 12% a year, and the money runs out after 13 years 10 months.
Safe withdrawal rate: the key number
The withdrawal rate is your yearly withdrawals divided by the corpus. A rough guide from the examples:
| Corpus | Monthly withdrawal | Rate | Return | Result |
|---|---|---|---|---|
| ₹20 lakh | ₹15,000 | 9% | 8% | Lasts 15 years with ₹14.2 lakh left |
| ₹20 lakh | ₹20,000 | 12% | 8% | Runs out in 13 years 10 months |
| ₹50 lakh | ₹30,000 | 7.2% | 7% | Lasts 20 years with ₹45.7 lakh left |
Keeping the withdrawal rate close to the expected return protects the capital. Inflation will raise your expenses over time, so leaving some growth in the corpus is wise.
SIP to SWP: building then drawing
A common plan is to run a SIP for 15 to 25 years, then switch to an SWP. Use the SIP calculator or the step up SIP calculator to estimate the corpus, then type that corpus here to see the income it can support. Many investors shift part of an equity corpus into debt or hybrid funds before starting withdrawals, so a market fall does not force them to sell at a low price.
SWP vs dividends vs fixed deposits
- SWP: you choose the amount and date. Each withdrawal sells some units; only the gain part is taxed.
- Dividend (IDCW) option: payouts are irregular and taxed in full at your slab rate.
- FD interest payout: fixed and predictable, but fully taxed each year. See the FD calculator.
- SCSS or MIS: government backed regular income with limits; see the SCSS calculator and the MIS calculator.
For many retirees a mix works: a fixed income base from SCSS or deposits, and an SWP from funds for the rest.
Things to check before starting an SWP
- Exit load: some funds charge if units are sold within a year of purchase.
- Fund type: an SWP from a pure equity fund can sell units at low prices in a bad year.
- Withdrawal date: set it a few days before you need the money.
- Review yearly: if returns fall short, lower the withdrawal early rather than late.
Returns are not steady, and a run of poor years at the start of withdrawals hurts most. Use a cautious return. Retirement income plans benefit from a SEBI registered adviser's review.
Frequently asked questions
What is an SWP?
A systematic withdrawal plan, where a fixed amount is taken from a mutual fund at regular intervals, usually monthly.
How long will ₹20 lakh last with ₹20,000 a month SWP?
At an assumed 8% a year, about 13 years 10 months. At ₹15,000 a month it lasts beyond 15 years.
Is SWP income taxable?
Each withdrawal is a sale of units. Tax falls only on the gain portion, at a rate set by fund category and holding period.
Can I use a SIP and SWP calculator together?
Yes. Estimate the corpus with the SIP calculator, then type that amount here as the amount invested.
What withdrawal rate is safe?
One close to or below the expected return keeps the corpus roughly intact. Higher rates eat into capital.
Can I change or stop an SWP?
Yes. Fund houses generally let you alter or end it whenever you wish.