Systematic Withdrawal Plan (SWP) Calculator
Plan your retirement income. SWP lets you withdraw a fixed monthly amount from your mutual fund corpus while the balance keeps earning. See how long your corpus will last — or how much monthly withdrawal a target corpus can sustain.
Methodology. Each month: balance grows at monthly rate (annual/12), then monthly withdrawal subtracted. If balance hits zero, corpus is exhausted. SWP is tax-efficient — withdrawals are treated as redemptions; equity LTCG above ₹1.25L/year taxed at 12.5%, debt at slab. Target safe withdrawal rate: 4–5% of corpus annually for sustainability across 25–30 year retirements.
How an SWP works
A systematic withdrawal plan sells a fixed amount of mutual fund units every month and pays the money to your bank. The remaining units keep earning returns. If your monthly withdrawal is less than what the corpus earns, the corpus can last indefinitely; if it is more, it slowly runs down.
Worked example
A ₹50 lakh corpus earning 8% a year makes about ₹33,300 a month. So:
- Withdrawing ₹30,000 a month — the corpus never runs out (it slowly grows).
- Withdrawing ₹45,000 a month — the corpus lasts about 17 years.
This is the core of retirement income planning: a withdrawal rate of roughly 3–4% of the corpus a year, raised gradually for inflation, is far more durable than 8–10%.
Tax on SWP withdrawals
Each withdrawal is part capital and part gain, and only the gain is taxed. For equity funds held over 12 months, long-term gains above ₹1.25 lakh a year are taxed at 12.5%, so a well-planned equity SWP can be very tax-efficient compared with FD interest taxed at slab rates. Debt fund units bought after 1 April 2023 are taxed at slab rates.
Making an SWP safer
- Keep 2–3 years of withdrawals in a liquid or short-duration debt fund and run the SWP from there, topping it up from equity in good years.
- Start withdrawals a year after investing so that equity units are already long-term.
- Review the withdrawal amount every year after a market fall.
To work out the corpus you need in the first place, use the retirement corpus calculator.
FAQs
SWP or dividend option?
SWP gives a predictable amount and better tax treatment; dividends (IDCW) are irregular and taxed at slab rates.
Is there an exit load?
Many equity funds charge 1% on units redeemed within a year, so time your SWP start accordingly.
Can I change the SWP amount?
Yes — cancel and register a new SWP at any time.
Figures last checked October 2026. Calculator results are estimates; actual lender, fund or tax outcomes can differ.