Contents
- 1 Retirement Calculator — Corpus Needed & Monthly SIP
Retirement Calculator — Corpus Needed & Monthly SIP
No Sign-Up. No Paywall. Find out how much corpus you need for retirement and the monthly SIP to get there. India-specific with inflation.
Visual Breakdown
The Retirement Planning Framework
Indian retirement planning has four pillars. A diversified approach across all four creates resilience:
| Pillar | Instruments | Expected Return | Liquidity |
|---|---|---|---|
| 1. Mandatory Savings | EPF, NPS Tier 1, Gratuity | 8.25% / 10-12% / Lump at exit | Locked till 58/60 |
| 2. Voluntary Long-Term | PPF, VPF, Sukanya Samriddhi | 7.1-8.25% | Long lock-ins (15-21 years) |
| 3. Market-Linked Growth | Equity MF (SIP), Index Funds, ELSS, Stocks | 10-13% | Daily, with exit load early |
| 4. Fixed-Income Reserve | FD, Bonds, SCSS (senior), POMIS | 6.5-8.2% | Monthly/maturity |
How Much Do You Need to Retire?
Indian financial planners use the "25x annual expense" rule (4% withdrawal rate). Calculate your monthly expense at retirement, multiply by 12 to get annual, then by 25 for required corpus.
| Current Monthly Expense | Inflated to 60 (assume 30 yr, 6% inflation) | Required Corpus (25x annual) |
|---|---|---|
| ₹30,000 | ~₹1.72 lakh | ~₹5.17 crore |
| ₹50,000 | ~₹2.87 lakh | ~₹8.61 crore |
| ₹75,000 | ~₹4.31 lakh | ~₹12.93 crore |
| ₹1,00,000 | ~₹5.74 lakh | ~₹17.23 crore |
| ₹1,50,000 | ~₹8.61 lakh | ~₹25.84 crore |
Retirement Corpus — How to Build It
Age 25-35: Aggressive Equity Allocation
- 80% equity (Flexi-cap, Index Fund, Mid-cap, Small-cap)
- 15% PPF + EPF + NPS
- 5% Gold/International
- Step-up SIP 10% annually as salary grows
Age 35-50: Growth + Stability
- 65% equity (mostly large-cap, multi-cap)
- 25% debt (PPF, EPF, NPS, debt MF)
- 10% gold/alternatives
- Top-up SIPs whenever you get bonus/inheritance
Age 50-60: De-risking Phase
- 45% equity (large-cap focus)
- 40% debt (FD, corporate bond, NPS Tier 1)
- 15% liquid/gold
- Start SWP planning
Age 60+: Income Phase
- 30% equity (Hybrid funds, large-cap MF)
- 50% debt (Senior Citizen Saving Scheme, RBI Bonds, FD, debt MF for SWP)
- 15% liquid (3-year expense buffer)
- 5% gold
SCSS + POMIS — Post-Retirement Income
| Scheme | Eligibility | Interest | Max Investment | Tax |
|---|---|---|---|---|
| SCSS (Senior Citizen Saving Scheme) | 60+ years | 8.2% (Q3 FY25) | ₹30 lakh | Slab; 80TTB ₹50K exempt |
| POMIS (Post Office Monthly Income) | Any age | 7.4% | ₹9 lakh single / ₹15 lakh joint | Slab |
| RBI Floating Rate Bond | Any age | ~7.4% (variable) | No limit | Slab |
| PMVVY (Pradhan Mantri Vaya Vandana) | 60+ years | 7.4% | ₹15 lakh | Slab |
A retiree with ₹50 lakh corpus can allocate: ₹15L SCSS + ₹15L PMVVY + ₹15L RBI Bonds + ₹5L liquid = ₹3.5+ lakh annual interest income, mostly tax-free under 80TTB ₹50K + reduced slab.
Worked Examples
Example 1: Age 30, Target ₹5 Crore by 60
Required SIP: ₹13,500/month at 12% expected return (with annual 8% step-up). If returns are 14% (mid-cap heavy), required SIP drops to ₹8,500/month. If only 10%, requires ₹20,000/month.
Example 2: Late Starter at 40, Target ₹3 Crore by 60
Required SIP: ₹38,000/month at 12% return. Higher monthly burden but still achievable for senior managers.
Example 3: Corpus Sustainability — SWP from ₹5 Crore
₹5 crore corpus at 60. Conservative 60-40 allocation (equity-debt). Expected return 9%. 4% Safe Withdrawal Rate: ₹16.67 lakh annually (₹1.39 lakh monthly). Sustainable 30+ years assuming inflation-adjusted withdrawals. 5% Aggressive: ₹20.83 lakh annually (₹1.74 lakh monthly). Sustainable ~25 years.
Common Retirement Planning Mistakes
- Starting too late: Compounding's power is exponential — 5 years lost early = 50% lost corpus at end
- Over-allocating to FD: 7% pre-tax = 4.9% post-tax for 30% slab. Inflation 6% = negative real return
- Ignoring inflation: ₹1 lakh today's expenses = ₹3.2 lakh in 20 years at 6% inflation
- Relying solely on EPF/NPS: Mandatory savings cover 30-40% of needs at best. Voluntary investments cover the rest
- Not buying health insurance: Without ₹15-25 lakh family floater, medical expense can devastate retirement corpus
- Wrong asset allocation by age: 70-year-old in 80% equity is too risky; 30-year-old in 80% FD too conservative
- Forgetting nominees: All financial assets need updated nominees to avoid inheritance disputes
- No emergency fund: Forces early breaking of investments during job loss or medical emergency, breaking the compounding chain
More FAQs
Should I retire at 60 or work longer?
Statutory retirement is 60 (public sector) or no fixed (private). Working till 65 has triple benefit: 5 more earning years, 5 more compounding years, 5 fewer years of withdrawal. Can dramatically improve corpus sustainability.
What is FIRE?
Financial Independence Retire Early. Aggressive savings (40-70% of income) + extreme frugality + high equity allocation. Aim for corpus of 25-33x annual expenses by age 40-50. Growing community in India. See our FIRE Calculator.
Should I take pension or lump-sum from NPS?
Mandatory 40% annuity at retirement. The 60% lump-sum is tax-free. Many retirees invest the 60% in MF for SWP — often beats pension annuity rates of 5-7%. But annuity provides guaranteed income for life.
What about senior citizen insurance?
Get comprehensive family floater (₹15-25 lakh) before retirement. Post-60 health insurance is harder and costlier. Top-up plans add ₹50L-₹1Cr coverage cheaply. Don't ignore — medical inflation runs 10-12% annually.
How does inflation affect retirement?
Inflation is the biggest enemy. ₹50K/month expense today becomes ~₹2.87L in 30 years at 6%. Plan for inflation in BOTH corpus accumulation (10-12% equity returns beat 6% inflation) AND withdrawal phase (annual SWP step-up by 5-6%).
Retirement planning in New Tax Regime?
Most retirement instruments lose tax benefits under New Regime: PPF/ELSS/NPS deductions removed. EPF still works (Section 10(11) exemption on contribution within limits). Many old-regime supporters argue Old Regime is structurally better for retirement-focused taxpayers.
What is the 25x rule?
Required retirement corpus = 25 × annual expenses. Based on 4% Safe Withdrawal Rate. ₹6L annual expense → ₹1.5cr corpus. Simple, conservative estimate. Inflation requires step-up SWP.