Quick answer
An SWP (Systematic Withdrawal Plan) pays you a fixed amount from a mutual fund every month while the rest stays invested. With ₹50 lakh earning 8% a year, you can withdraw about ₹32,000 a month and keep your capital intact. Withdraw more than the returns and the corpus slowly runs down.
Key takeaways
- The capital-preserving withdrawal is roughly corpus × monthly return.
- SWP is often more tax-efficient than FD interest: only the gain portion of each withdrawal is taxed.
- Hybrid or balanced advantage funds are popular for SWPs because they swing less than pure equity.
How the SWP calculator works
Each month the withdrawal is taken out and the remaining balance earns the monthly equivalent of your annual return. The simulation runs until the period ends or the money runs out.
Balancenext = (Balance − W) × (1 + rm)- W = monthly withdrawal
- rm = (1 + annual return)1/12 − 1
Why SWP can be more tax-efficient than an FD
FD interest is fully taxed at your slab rate every year. With an SWP, each withdrawal is part capital and part gain, and only the gain is taxed. For equity-oriented funds held over 12 months, the first ₹1.25 lakh of long-term gains each year is tax-free and the rest is taxed at 12.5%.
Frequently asked questions
How much monthly income can I get from ₹1 crore?
At 8% a year, about ₹64,000 a month keeps the ₹1 crore intact. At 7% it is about ₹56,500. Withdrawing more will slowly use up the capital.
What is a safe withdrawal rate for SWP?
For a retirement lasting 25–30 years, many planners suggest starting at 4–5% of the corpus a year and raising it with inflation. The step-up input above lets you model this.
Can I start an SWP in any mutual fund?
Most open-ended funds allow SWPs. Choose the growth option, not IDCW, so you control the payout amount.
Sources & methodology
Formulas follow the standard methods used by Indian banks, fund houses and government schemes. Rates and tax rules were checked against official sources on 1 October 2026. Read our methodology.
This calculator gives an estimate for planning purposes. Actual returns, tax and eligibility depend on your situation and on product terms. It is not financial advice.