SWP Calculator – Plan Your Monthly Income from Investments
A Systematic Withdrawal Plan (SWP) allows you to withdraw a fixed amount from your mutual fund corpus every month. The remaining corpus stays invested and continues to earn returns – ideally at a rate that offsets the withdrawal.
Use this calculator to see how long your corpus lasts at different monthly withdrawal amounts and return rates, or to find the maximum sustainable monthly withdrawal from a given corpus.
SWP vs Fixed Deposit – The Tax Difference
FD interest is fully taxable at your slab rate every year – at 30% for most retirees with substantial savings. SWP withdrawals have only the gains portion taxable – at 12.5% LTCG for equity funds held over 12 months. For a ₹1 crore corpus, this can mean ₹60,000-80,000 less tax annually versus the equivalent FD interest.
SWP Planning Tips
The 4% Rule as a Starting Point
Withdraw no more than 4% of corpus annually to sustain it over 25-30 years. For ₹1 crore corpus this is ₹4 lakh/year or ₹33,000/month. Adjust based on your specific fund and return expectations.
Choose the Right Fund for SWP
Balanced advantage and aggressive hybrid funds are typically better for SWP than pure equity funds – they manage equity-debt balance dynamically, reducing the risk of selling equity units at low prices during withdrawals.
Frequently Asked Questions
How is SWP taxed compared to FD interest?
FD interest is taxed as income at your full marginal slab rate. SWP withdrawals from equity funds have only the gains portion taxable. For long-term equity holdings with LTCG tax at 12.5%, post-tax income from SWP is significantly higher than FD for the same gross amount.
What is the minimum corpus needed for SWP?
At a 4% annual withdrawal rate, ₹1 crore supports ₹33,000/month, ₹2 crore supports ₹67,000/month, ₹3 crore supports ₹1 lakh/month. We calculate required corpus based on your specific monthly income need.
Can I change the SWP amount after starting?
Yes. SWP amount can be increased, decreased, paused or stopped at any time without penalty.