What is an SWP Calculator?
A Systematic Withdrawal Plan (SWP) calculator helps you model periodic withdrawals from a one-time investment while the remaining corpus continues to grow. It’s ideal for planning retirement income or regular cash flows from mutual funds.
How This SWP Calculator Works
This tool uses monthly compounding and monthly withdrawals. The monthly payout increases annually with inflation.
- Initial Investment: Lumpsum amount invested at the start
- Monthly Withdrawal: Cash flow you receive each month
- Duration: Number of years the withdrawals continue
- Expected Returns: Annual return assumption compounded monthly
- Inflation: Applied once a year to the monthly payout
Inspired by the approach described at Finlive.
Tips for Using SWP
📆 Prefer Monthly Payouts
Align your SWP date close to typical expense dates for smoother cash flow.
📈 Keep Real Returns Positive
Ensure expected returns reasonably exceed inflation to sustain the corpus.
🧯 Maintain Emergency Buffer
Avoid selling growth assets at lows by keeping 6–12 months of expenses aside.
🧮 Review Annually
Revisit inflation, returns, and payout amounts at least once a year.