SWP (Systematic Withdrawal Plan) Calculator
See how long your investment lasts with regular monthly withdrawals.
Estimate; returns are not guaranteed.
What Is a Systematic Withdrawal Plan (SWP)
A Systematic Withdrawal Plan (SWP) lets you withdraw a fixed amount from your mutual fund investment at regular intervals, usually every month, while the remaining corpus stays invested and continues to earn returns. It is essentially the reverse of a SIP: instead of putting money in regularly, you take money out regularly.
SWPs are popular among retirees and anyone who wants a steady, predictable cash flow from a lump sum, such as a retirement corpus or a maturity payout. Because only the units you redeem are sold each month, the rest of your money keeps growing, which can help your corpus last longer than a plain savings withdrawal would.
How the SWP Math Works
Each month two opposing forces act on your corpus: it grows by the monthly return rate, and it shrinks by the amount you withdraw. The month-by-month logic is:
Balance(next) = Balance(now) × (1 + r) − W
where r is the monthly rate of return (annual return ÷ 12, expressed as a decimal) and W is your fixed monthly withdrawal. Repeating this each month tells you how the balance evolves, how long the money lasts, and what is left at the end of a chosen period.
A useful rule of thumb: if your withdrawal is smaller than the monthly return your corpus earns, the balance can actually keep rising. If your withdrawal is larger than the return earned, the corpus steadily erodes and will eventually run out.
A Worked Example in Rupees
Suppose you invest a corpus of ₹50,00,000, expect a 10% annual return (so r = 10% ÷ 12 ≈ 0.8333% per month), and withdraw ₹40,000 every month.
Month 1: ₹50,00,000 × 1.008333 = ₹50,41,667, minus ₹40,000 = ₹50,01,667.
Because the monthly return earned (about ₹41,667) is slightly more than the ₹40,000 you take out, the balance inches up rather than down in the early months. Now raise the withdrawal to ₹60,000: the corpus earns about ₹41,667 but loses ₹60,000, so it falls by roughly ₹18,000 in month one and keeps declining, lasting only a limited number of years. The calculator above runs this loop for you and shows exactly how long the money lasts and the balance remaining at each stage.
Tax and Practical Considerations in India
Every SWP withdrawal is a redemption of units, so it can trigger capital gains tax. For equity funds, gains are classified as short-term or long-term based on the holding period, with long-term gains above the prescribed annual threshold taxed at the applicable rate. Debt fund gains are taxed as per current rules, which have changed in recent years. Treat any tax figures as examples and verify the latest rates before relying on them.
Practical tips: keep your withdrawal rate conservative so the corpus is not exhausted too soon, review the plan yearly, and remember that real-world returns vary year to year unlike the steady rate this calculator assumes. Build in a margin for inflation and market dips, and consult a SEBI-registered adviser for a plan tailored to your needs.
Frequently Asked Questions
A SIP invests a fixed amount regularly to build wealth, while an SWP withdraws a fixed amount regularly to generate income. SIP is for accumulation; SWP is for the spending or retirement phase.
It can if your withdrawals stay below the returns your corpus earns. If you withdraw less than the monthly growth, the balance keeps rising. If you withdraw more, the corpus gradually depletes and will eventually run out.
Yes. Each withdrawal redeems units and may attract capital gains tax depending on the fund type and holding period. The exact treatment depends on current rules, so verify the latest rates or consult a tax adviser.
Use a realistic, conservative figure based on the fund category, for example a lower rate for debt funds and a moderate rate for balanced or equity funds. Remember actual returns fluctuate and are not guaranteed.
Yes. Most fund houses let you modify the withdrawal amount, change the frequency, pause, or stop the SWP at any time, usually online, subject to any exit load on the units being redeemed.
This calculator assumes a fixed monthly withdrawal. To protect purchasing power, you may want to increase your withdrawal over time, but doing so will deplete the corpus faster, so plan with a margin of safety.