SWP Calculator
This SWP calculator shows what happens to an investment corpus when you draw a fixed monthly income from it — the reverse of a SIP. Enter your starting corpus, the return it keeps earning, your monthly withdrawal, and the period, and see the balance remaining at the end. It is the standard tool for retirees and anyone converting a lump sum (PF payout, property sale, matured investment) into a monthly income stream.
The lump sum you already have invested — typically a mutual fund corpus built up via SIP or a retirement lump sum you are now drawing down.
The return your remaining corpus keeps earning while you withdraw. Hybrid/debt funds used for SWP typically return 7–10%.
The fixed amount you take out each month. This is the income the SWP is designed to replace — a salary, pension top-up or living expenses.
How many years you plan to draw the SWP. Retirement SWPs commonly run 15–30 years.
Balance remaining at the end
₹40,18,299
What's left in the corpus after every withdrawal — if this shows ₹0, your withdrawal rate exceeded what the corpus could sustain.
The total income you drew out — your monthly withdrawal amount multiplied by every month in the period.
The lump sum you began with, shown for comparison against the balance remaining and total withdrawn.
How much the corpus's own investment returns contributed alongside your withdrawals — positive means the corpus grew despite the withdrawals.
How to use this swp calculator
- 1Starting corpus: the lump sum you are drawing down today — after any taxes or exit loads already paid.
- 2Expected annual return: the return your remaining balance keeps earning each month, even as you withdraw. Use a conservative figure for money you cannot afford to run out — 7–9% for a hybrid or balanced fund is typical.
- 3Monthly withdrawal: keep this below the corpus's expected annual return divided by 12, on average, or the balance will shrink faster than it grows.
- 4Withdrawal period: match this to how long you actually need the income — a 20–30 year retirement horizon is common.
Understanding your results
The balance remaining is the number that matters most: if it shows zero, your withdrawal rate exceeded what the corpus could sustain and the money ran out before the period ended — try a smaller monthly withdrawal or a longer time horizon for the corpus to recover. Total withdrawn is simply your monthly figure times the number of months, showing the total income drawn. Growth added by returns is the corpus's own earnings working alongside your withdrawals — when this number is healthy and positive, the SWP is sustainable; when it turns sharply negative relative to the corpus, you are spending down principal faster than it can regrow.
The formula
Balanceₙ = (Balanceₙ₋₁ × (1 + i)) − WEach month, the remaining balance earns one month's interest at rate i (annual rate ÷ 1200), and then the fixed withdrawal W is subtracted. This repeats for every month of the period, which is why an SWP calculator cannot be solved with a single closed-form formula the way a loan or SIP can — it needs to be simulated month by month. If withdrawals consistently exceed monthly growth, the balance declines every month and eventually reaches zero; if growth consistently exceeds withdrawals, the balance keeps compounding upward even as you draw income from it.
A worked example
A ₹50,00,000 corpus earning 8% annually, with a ₹35,000 monthly withdrawal over 20 years: the balance remaining at the end is approximately ₹40,18,299 — the corpus not only survived 240 monthly withdrawals totalling ₹84,00,000, it grew, because the 8% return outpaced the roughly 8.4% annualised withdrawal rate closely enough for compounding to keep up in most years. Push the withdrawal to ₹45,000/month on the same corpus and rate over 15 years, and the balance falls to about ₹9,62,887 — still positive, but visibly depleting. This is the core SWP trade-off: withdrawal rate versus corpus longevity.
Notes for the UK, US and India
SWP is primarily an Indian mutual-fund mechanism and a common retirement-income tool there; the UK and US equivalent is simply 'drawdown' from a pension (SIPP, 401k or IRA), following the same month-by-month maths. In India, SWP from equity funds held over a year benefits from the same 12.5% LTCG treatment as any equity redemption, often making it more tax-efficient than an annuity's fully-taxable income. A widely used rule of thumb is the '4% rule' — withdrawing 4% of the corpus annually (roughly corpus ÷ 300 per month) has historically had a low chance of depleting a well-diversified portfolio over 25–30 years, though sequence-of-returns risk in the early years matters more than the average return.
Frequently asked questions
How much can I withdraw monthly without depleting my corpus?+
As a rough guide, keep your annual withdrawal near or below the corpus's expected annual return — roughly withdrawal × 12 ÷ corpus should not exceed your assumed return rate by much. The calculator above lets you test your exact numbers rather than relying on rules of thumb.
What is the difference between SWP and a fixed annuity?+
An SWP keeps your money invested and market-linked, so both the income and the remaining balance can vary with returns; an annuity pays a fixed income for life in exchange for handing over the corpus permanently. SWP offers flexibility and a bequeathable balance; annuities offer certainty.
Is SWP income taxable?+
In India, each SWP instalment is treated as a partial redemption — only the gain portion is taxed (as LTCG or STCG depending on holding period and fund type), not the whole withdrawal, which is usually more tax-efficient than fully taxable interest or pension income.
Can I change my SWP amount later?+
Yes — most funds let you modify or pause an SWP at any time without penalty. Re-run this calculator whenever your income needs or the fund's performance changes to check the balance is still on track.
What happens if my fund's actual return is lower than I assumed?+
The corpus will deplete faster than this calculator shows, since it assumes a constant return. Stress-test by lowering the rate a few points and checking the balance — if it still lasts your required period at a conservative rate, the plan has a safety margin.