A Systematic Withdrawal Plan turns an invested corpus into monthly income while the balance keeps earning. Here is how to size it.
A Systematic Withdrawal Plan is the mirror image of a SIP: a fixed amount moves from your fund to your bank every month, like a self-created salary, while the remaining corpus stays invested. Done right, it provides income for decades. Done greedily, it exhausts the corpus early. The difference is the withdrawal rate.
Sizing the withdrawal
The arithmetic is unforgiving: withdraw meaningfully more than the corpus earns and depletion is only a matter of time. A 50 lakh corpus earning 8% comfortably sustains 40,000 a month for twenty years; push the same corpus to 60,000 a month and it runs out years early. Our SWP Calculator shows the exact month a plan would deplete, which makes the trade-off honest before it becomes painful.
Why retirees prefer SWP over interest income
Tax efficiency: only the gain portion of each withdrawal is taxed, unlike interest which is fully taxable at slab. Flexibility: the amount can be raised, lowered or paused any time. And growth: in sustainable plans, the corpus can actually increase even while paying you.
We typically pair an SWP with SCSS and fixed income, so dependable instruments cover the base expenses and the SWP funds the lifestyle layer. Bring your numbers and we will structure it together.
Questions about your own plan?
A short conversation with a veteran-led team costs nothing and usually clarifies a lot.