SWP calculator
Work out what a lump sum can pay you each month, and for how long, at a yearly return you assume. Withdrawals come out at the start of each month, before that month’s growth.
Left after 15 years
Working out your figures…
Enter an assumed return from 2% to 13% a year to see the illustration.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
Past performance may or may not be sustained in future and is not a guarantee of any future returns.
How it is worked out
Each month, take out W, then the rest grows by i.
How much I can take: W = (C − T(1 + i)−n) × i ÷ ((1 + i)(1 − (1 + i)−n))
How much I need: C = W(1 + i)(1 − (1 + i)−n) ÷ i + T(1 + i)−n
C is the lump sum, W the monthly withdrawal, T what is left at the end, i the yearly return ÷ 12 and n the number of months. With a 0% return, W = (C − T) ÷ n.
Left out: capital gains tax, exit loads, stamp duty and changes in the scheme’s costs.
Questions
01Are withdrawals taken before or after growth?
At the start of each month, before that month’s growth, so the first withdrawal comes out of the full lump sum.
02What happens when the money runs out?
The withdrawals stop. The calculator pays out what is left as the last withdrawal and shows how long the money lasted.
03Is tax on withdrawals included?
No. Each withdrawal is a redemption of units, and capital gains tax can apply to the gain in them. Exit loads and stamp duty are left out too. Enter a return after the scheme’s costs if you want to allow for them.
Other calculators
How to invest in a Regular plan
Through a mutual fund distributor registered with AMFI, who holds an ARN. Find a distributor on AMFI’s website (amfiindia.com)
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.