ReckonBoxHow the SWP calculator works
An SWP calculator shows what happens to a corpus when you withdraw a fixed amount each month while the rest stays invested and grows. SWP stands for systematic withdrawal plan, the mirror image of a SIP: instead of building a corpus, you draw an income from one. Give it four things: the corpus, the monthly withdrawal, the return you expect, and how long you plan to draw. It answers the question every other number hangs on, whether the money lasts, and shows the balance falling year by year.
A ₹10 lakh corpus earning 8 percent supports a ₹10,000 monthly withdrawal for the full 10 years and still leaves about ₹3.9 lakh. Push the withdrawal to ₹25,000 and the same corpus is gone in year four. Turn on an annual increase to keep the income level with rising prices, and read the year-by-year table to see exactly when the balance thins out.
The formula, in plain terms
In an SWP, each month the balance grows by the monthly return, then the withdrawal comes out: balance = balance x (1 + i) minus the withdrawal. Here i is the monthly return, your annual rate divided by 12. Run that line month after month and you get the closed form B = P x (1 + i)^n minus W x ((1 + i)^n minus 1) / i, where P is the starting corpus and n the months. Some calculators print an annuity formula that does not match their own tables; this one simulates the real recurrence, which is the only way to catch the exact month a corpus runs dry.
Will your corpus last?
Whether a corpus lasts comes down to one race: your monthly withdrawal against the growth on what remains. When the withdrawal is smaller than the growth, the balance still rises; when it is larger, the corpus erodes and eventually hits zero. The table below runs a ₹10 lakh corpus at 8 percent across withdrawal sizes.
| Monthly withdrawal | Balance after 10 years | Corpus runs out |
|---|---|---|
| ₹8,000 | ₹7.56 lakh | year 23 |
| ₹10,000 | ₹3.90 lakh | year 14 |
| ₹15,000 | nil | year 8 |
| ₹25,000 | nil | year 4 |
The cliff is steeper than it looks. Even ₹8,000 a month is a 9.6 percent yearly draw on ₹10 lakh, and it still empties the corpus by year 23. That is why the 4 percent rule, roughly ₹3,300 a month on this corpus, and the 300x shorthand, a corpus near 300 times the monthly withdrawal, are the numbers planners reach for.
Keeping income level with inflation
A step-up keeps your withdrawal level with inflation by raising it a set percent each year. A flat ₹10,000 buys less every year, so a real income plan lifts the amount, often around 6 percent, to hold its purchasing power. That comfort has a cost: the higher later withdrawals drain the corpus faster, pulling the depletion year forward. Switch the annual increase on and the year-by-year table shows the trade in full, with the withdrawal climbing and the balance falling quicker than the flat case.
Where the estimate can mislead
An SWP calculator assumes a steady return, and a withdrawal plan is unusually exposed to when the bad years arrive. A poor stretch early on, while the corpus is largest and you are still taking money out, does lasting damage that the same stretch later would not, a risk a flat rate cannot show. SWPs often run on debt or hybrid funds, so a cautious 7 to 8 percent is worth testing over a hopeful 12. Each withdrawal is also a partial redemption, so the growth part is taxed as capital gains, and the figures here are pre-tax. Treat the depletion year as a planning estimate. Mutual fund returns are market-linked, so for a retirement income plan talk to a SEBI-registered adviser. To size the corpus in the first place, the SIP calculator works the accumulation side.
Frequently asked questions
What is an SWP calculator? An SWP calculator is a tool that shows what happens to a lumpsum corpus when you withdraw a fixed amount every month while the rest stays invested and grows. It reports the total withdrawn, the returns earned, the balance left at the end, and whether the corpus lasts the full period or runs out early.
How is an SWP calculated? Each month the balance grows by the monthly return, then the withdrawal is subtracted: balance = balance x (1 + i) minus W. The closed form is B = P x (1 + i)^n minus W x ((1 + i)^n minus 1) / i, and the calculator runs it month by month so it can spot the exact month the corpus runs dry.
Will my corpus run out? It depends on whether your withdrawal outpaces the growth. A ₹10 lakh corpus at 8 percent supports ₹10,000 a month for the full 10 years with about ₹3.9 lakh left, but ₹25,000 a month drains it in under five years. The calculator names the year it runs out, or confirms it survives with a balance.
What is a safe withdrawal rate? A safe withdrawal rate is the share of a corpus you can take each year without exhausting it too soon, often discussed as the 4 percent rule or a range of 4 to 6 percent for long horizons. A related shorthand, the 300x rule, says a corpus of about 300 times your monthly withdrawal is a sturdy starting point.
How do I keep my income up with inflation? Set an annual increase on the withdrawal so the monthly amount rises each year. Raising a ₹10,000 withdrawal 6 percent a year keeps its buying power roughly steady, but it drains the corpus faster, which the year-by-year table makes visible.
Are SWP withdrawals taxed? Yes. Each withdrawal is a partial redemption, so the growth portion is taxed as capital gains at a rate that depends on the fund type and holding period, while your own capital is not taxed again. The figures here are pre-tax, so the money in hand is a little lower.
What return should I assume for an SWP? SWPs often run on debt or hybrid funds for steadier withdrawals, so a lower assumption like 7 to 8 percent is common, against 12 percent for a growth SIP. A lower return makes the corpus deplete sooner, so it is worth testing a cautious rate.
Is an SWP better than a fixed deposit for income? They behave differently: an FD pays a fixed interest and returns your principal, while an SWP draws from a growing but market-linked corpus and is taxed only on gains. An SWP can leave a larger balance if returns are good, and can deplete faster if they are poor.
Can I start an SWP with a SIP corpus? Yes, that is the common path: accumulate through a SIP, then switch the built-up corpus to an SWP for income. Use the SIP calculator to size the corpus first, then this tool to plan the withdrawals from it.
Is the projected balance guaranteed? No. Mutual fund returns are market-linked and vary year to year, so the balance and the depletion year are estimates based on the steady rate you assume, not a promise. It is a planning tool, not investment advice.