How Much Corpus Do You Need for ₹1 Lakh a Month?
By Chirag Jain, Director of Research and Client Relations, Northbridge Wealth (ARN-41379). Last updated: August 2026.
Around ₹2.4 crore. That comes from a 5% withdrawal rate: ₹1 lakh a month is ₹12 lakh a year, and ₹12 lakh is 5% of ₹2.4 crore. The useful part of that rule is that it scales, so the corpus you need is roughly twenty times the annual income you want. What makes 5% work rather than just sound reasonable is what happens next. At a 10% portfolio return, withdrawing ₹1 lakh a month and raising it 6% every year for inflation, ₹2.4 crore does not run down over 25 years. It grows to about ₹5.5 crore while paying out more than ₹6.5 crore along the way.
Key takeaways
- ₹2.4 crore for ₹1 lakh a month, at a 5% withdrawal rate.
- The rule scales: corpus = 20 times the annual income you need.
- At a 10% return with a 6% annual step-up, the corpus grows rather than depletes, ending around ₹5.5 crore after 25 years.
- The step-up is not optional. ₹1 lakh today has the buying power of about ₹31,000 in twenty years at 6% inflation.
- The plan is sensitive to returns. At 8% instead of 10%, the same ₹2.4 crore runs out in year 26.
The arithmetic
A withdrawal rate is simply what you draw in a year as a percentage of your corpus. Draw ₹12 lakh from ₹2.4 crore and your rate is 5%.
At 5%, with a 10% return and the withdrawal rising 6% a year, here is what happens to ₹2.4 crore over 25 years:
| Amount | |
|---|---|
| Starting corpus | ₹2.40 crore |
| Withdrawn over 25 years | ₹6.58 crore |
| Corpus at the end of 25 years | ₹5.49 crore |
| Monthly withdrawal in year 25 | ₹4.05 lakh |
You spend ₹6.58 crore and finish with more than twice what you started with. That is not a trick of presentation. It is what happens when the portfolio compounds faster than you draw from it: the gap between a 10% return and a 5% initial draw leaves roughly 5% a year still working, and that surplus compounds while the withdrawal climbs with inflation.
Why 5% and not more
The rate is the whole plan. Change it and the outcome changes completely. All four rows below assume ₹1 lakh a month rising 6% a year, at a 10% return.
| Withdrawal rate | Corpus needed | After 25 years | After 30 years |
|---|---|---|---|
| 4% | ₹3.00 crore | ₹11.99 crore | ₹15.65 crore |
| 5% | ₹2.40 crore | ₹5.49 crore | ₹5.18 crore |
| 6% | ₹2.00 crore | ₹1.16 crore | Depleted |
| 7% | ₹1.71 crore | Depleted | Depleted |
At 6% you survive 25 years with very little left and run out before 30. At 7% the plan fails outright. The ₹69 lakh you save by starting at 7% instead of 5% costs you the retirement.
Going the other way, 4% buys a large margin and leaves a substantial estate. If leaving money behind matters to you, or if you want protection against a poor decade of returns, the lower rate is the price of that safety.
What breaks it: the return assumption
Every figure above assumes a 10% return. Nobody can promise that, and it is worth knowing precisely how much rests on it. The same ₹2.4 crore, the same ₹1 lakh a month rising 6%:
| Assumed return | Position after 25 years | Position after 30 years |
|---|---|---|
| 7% | Ran out in year 23 | Ran out in year 23 |
| 8% | ₹0.54 crore left | Ran out in year 26 |
| 9% | ₹2.67 crore left | ₹0.52 crore left |
| 10% | ₹5.49 crore left | ₹5.18 crore left |
| 11% | ₹9.20 crore left | ₹11.75 crore left |
Two percentage points separate “you finished with ₹5 crore” from “you ran out at 86”. No withdrawal changed and no decision changed. Only the return did, and the return is the one input nobody controls.
We would treat any confident single-number answer with caution, including this one. The planning question is not what corpus works at 10%. It is what happens to your plan at 8%, and whether you could live with that outcome.
The part most calculators leave out: tax
Almost every corpus figure published online is pre-tax. It calculates what produces ₹1 lakh a month of withdrawals, not ₹1 lakh a month of spendable money.
The tax is smaller than most people expect, because an SWP instalment is a redemption rather than income. Only the capital gain inside each withdrawal is taxable; the rest is your own capital returning to you. And even the gain is not all taxed. For equity funds, the first ₹1.25 lakh of long-term gains in a financial year is exempt, and the 12.5% rate applies only to gains above that line. On a ₹2.4 crore corpus at 10%, the gain portion of each withdrawal grows like this:
| Year | Gain portion of each withdrawal |
|---|---|
| 1 | about 9% |
| 5 | about 38% |
| 10 | about 61% |
| 15 | about 76% |
| 25 | about 91% |
In year one, roughly ₹9,000 of a ₹1 lakh withdrawal is gain, and the annual total sits under the ₹1.25 lakh long-term exemption, so tax is nil. By year fifteen the gain crosses the exemption comfortably, and only the portion above ₹1.25 lakh is taxed at 12.5%.
The cumulative effect over a 30-year drawdown at 10%: instead of finishing with ₹5.18 crore, you finish with about ₹2.85 crore. Still comfortably intact, but ₹2.3 crore of that projection was tax. At a 9% return, tax is the difference between finishing with ₹52 lakh and running out in year 28. We cover the mechanics in our guide to how SWP is taxed [link “how SWP is taxed” → SWP Taxation post].
Why the withdrawal must rise every year
A flat ₹1 lakh a month for 25 years is not a plan, because ₹1 lakh will not buy in 2051 what it buys today.
At 6% inflation, ₹1 lakh a month today needs to be ₹1.79 lakh in ten years and ₹3.21 lakh in twenty, just to buy the same things. Put the other way, ₹1 lakh twenty years from now has the buying power of about ₹31,000 today. A corpus figure built on a flat withdrawal looks reassuringly small and quietly assumes your standard of living falls by two-thirds.
Medical costs deserve separate thought. Healthcare inflation in India runs well above general inflation, and it lands hardest in the later years of a retirement, exactly when the corpus is smallest.
Using ₹1 lakh as a unit
Because the rule is proportional, you can scale it to whatever income you actually need. Corpus equals twenty times annual income at a 5% rate.
| Monthly income needed | Annual | Corpus at 5% |
|---|---|---|
| ₹50,000 | ₹6 lakh | ₹1.2 crore |
| ₹1,00,000 | ₹12 lakh | ₹2.4 crore |
| ₹1,50,000 | ₹18 lakh | ₹3.6 crore |
| ₹2,00,000 | ₹24 lakh | ₹4.8 crore |
| ₹3,00,000 | ₹36 lakh | ₹7.2 crore |
| ₹5,00,000 | ₹60 lakh | ₹12 crore |
| ₹7,50,000 | ₹90 lakh | ₹18 crore |
| ₹10,00,000 | ₹1.2 crore | ₹24 crore |
Work out your number from expenses, not from salary. Take what you spend now, subtract what stops at retirement such as EMIs, children’s education and the saving you no longer need to do, then add what starts, such as higher medical costs and more travel. That figure is what the corpus has to produce.
What this arithmetic cannot tell you
Sequence risk. A bad run of returns in the first few years does far more damage than the same run later, because you are selling units at depressed prices while the corpus is at its largest. Two retirements with identical average returns can end very differently depending on when the bad years arrived.
Your asset allocation. A corpus drawn entirely from equity behaves nothing like one holding two or three years of expenses in liquid or short-duration funds. The second sells far fewer units at bad prices, which is most of the defence against sequence risk.
Everything outside the corpus. Rental income, EPF, an annuity, or a property you may sell all reduce what the corpus must carry. So does anything you intend to leave behind, which means it should not be planned to zero.
How we help with this
Getting from a number on a page to a retirement that holds involves decisions the arithmetic cannot make: which funds the withdrawals come from, how large a liquid buffer sits against a poor first few years, when to start, and how the plan gets adjusted as markets and expenses move. Northbridge Wealth is a registered mutual fund and SIF distributor, drawing on 26 years in Indian markets, and we help clients structure withdrawals, execute them, and review them on a fixed quarterly schedule rather than setting them once and hoping.
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Frequently asked questions
How much corpus do I need for ₹1 lakh per month in India? Around ₹2.4 crore at a 5% withdrawal rate. At a 10% return with the withdrawal rising 6% a year for inflation, that corpus lasts well beyond 25 years and grows rather than depletes.
What is a safe withdrawal rate in India? 5% works at a 10% return with an inflation step-up, and the corpus still grows. At 6% the plan survives 25 years but not 30. At 7% it fails. Lower rates such as 4% buy a wider margin against poor returns and leave a larger estate.
Is ₹1 crore enough for ₹1 lakh a month? No. ₹12 lakh a year from ₹1 crore is a 12% withdrawal rate, which exceeds any realistic return and depletes the corpus quickly. At a 5% rate, ₹1 crore supports about ₹42,000 a month; ₹50,000 a month needs closer to ₹1.2 crore.
Is ₹5 crore enough to retire in India? At a 5% rate, ₹5 crore supports roughly ₹2 lakh a month with annual inflation increases. Whether that is enough depends on your expenses, city, health costs and how long the money must last.
Should the withdrawal increase every year? Yes. At 6% inflation, ₹1 lakh twenty years from now buys what about ₹31,000 buys today. A flat withdrawal assumes a steadily falling standard of living.
Do I pay tax on SWP withdrawals? Only on the capital gain portion of each withdrawal, not the full amount, and for equity funds only on long-term gains above ₹1.25 lakh in a financial year, taxed at 12.5%. Early on the gain portion is small and often sits entirely under the exemption, so tax is nil. Over a 30-year drawdown the cumulative effect is significant, so it belongs in the plan.
Disclaimer: Northbridge Wealth (Suskan Finmaart Private Limited) is an AMFI-registered Mutual Fund Distributor (ARN-41379). All figures in this article are illustrative calculations based on stated assumptions and are not projections, forecasts, or guarantees of returns. Actual outcomes depend on market performance, which cannot be predicted. This article is for information only and is not investment, tax, or legal advice. Tax treatment depends on individual circumstances and current law. Mutual fund investments are subject to market risks; read all scheme-related documents carefully. Please consider your own situation before investing.
