Retirement Planning
SWP XIRR Calculator
Enter your corpus, monthly withdrawal, and remaining value — check returns during withdrawals
How Long Will My Money Last? SIP to Target SWP
- Initial Corpus (₹) ₹50.00 L
- Monthly Withdrawal (₹)
- Expected Return (%)
- Future Target Withdrawal
- Years until Retirement
- Accumulation Return (%)
- Retirement Return (%)
- Retirement Duration (Years)
Calculate Retirement Plan →
Corpus Lifespan
Required Monthly SIP Now
The SIP-to-SWP Strategy
What is SWP?
SWP (Systematic Withdrawal Plan) is the reverse of SIP. Instead of investing monthly, you withdraw a fixed amount from your invested corpus every month.
Common SWP Use Cases
- Retirement income — Regular pension-like withdrawals from your corpus
- Regular expenses — Monthly income from inheritance or windfall
- Tax efficiency — Systematic redemption to spread capital gains across years
- Education funding — Regular withdrawals for tuition fees
SIP vs SWP: Understanding the Difference
| Aspect | SIP (Accumulation) | SWP (Distribution) |
|---|---|---|
| Direction | Money flows IN monthly | Money flows OUT monthly |
| Goal | Build corpus over time | Generate regular income |
| Phase | Wealth accumulation (working years) | Wealth distribution (retirement) |
| Risk | Rupee cost averaging helps | Sequence-of-returns risk |
| XIRR Sign | Measures growth rate | Measures income yield + growth |
How is XIRR Calculated for SWP?
For SWP, the cashflow pattern is reversed compared to SIP:
// Example SWP cashflows
- Day 0: -₹50,00,000 (Initial corpus invested)
- Month 1: +₹25,000 (Withdrawal)
- Month 2: +₹25,000 (Withdrawal)
- ... 12 months ...
- Today: +₹48,00,000 (Remaining corpus value)
The XIRR tells you: what annualized return did your corpus generate while also providing you regular income?
💡 Key Insight
A positive SWP XIRR means your corpus grew even while you were withdrawing money. A 10% XIRR + 6% withdrawal rate = your money is still growing faster than you're spending it!
The 4% (or 6%) Safe Withdrawal Rule
The 4% rule (from US studies) suggests withdrawing 4% of your corpus annually allows it to last 30+ years. In India, with higher expected returns, many use a 6% rule:
Safe Withdrawal Formula
Monthly Safe Withdrawal = (Corpus × 6%) ÷ 12
Example: ₹50 Lakh corpus → ₹25,000/month sustainable withdrawal
Tax Implications of SWP
SWP is more tax-efficient than FD interest because:
- Each withdrawal is part principal return (not taxed) and part gains
- Only the capital gains portion is taxable
- LTCG on equity funds: 12.5% on gains above ₹1.25 Lakh/year
- You can spread redemptions across financial years to optimize taxes
Frequently Asked Questions
What's a good XIRR for SWP?
For equity-based SWP, 10-12% XIRR is considered good. For debt funds, 7-8% is typical. If XIRR exceeds your withdrawal rate, your corpus is still growing!
Does SWP work in a bear market?
SWP faces "sequence-of-returns risk" — withdrawing during market crashes depletes corpus faster. Consider keeping 2-3 years of withdrawals in liquid funds as buffer.
SWP vs Dividend Option: Which is better?
SWP from growth option is generally more tax-efficient than dividend (IDCW) option because you control the timing and amount of "income".
How do I start SWP on my mutual fund?
Log into your AMC/CAMS/KFintech portal → Select fund → "SWP" option → Enter amount and frequency → Set start date. Most platforms allow weekly, monthly, or quarterly SWP.
Plan Your Retirement Income
Calculate your SWP XIRR and check if your corpus will last.