Drawing an income
A salary you pay yourself,
from money that stays invested.
Once you have built a corpus, you can withdraw from it every month while the rest keeps working. That is all a systematic withdrawal plan is. The question worth answering is not whether it beats a deposit — it is how much you need before the withdrawal can keep up with prices for as long as you will need it.
Drawing a monthly income
Once a corpus exists, a fixed amount can be paid out to your bank each month while the rest stays invested. How much can safely come out depends on how long it has to last and what the money earns — taking too much early is what empties it. The payments are market-linked and are not guaranteed.
A corpus
The pot itself — everything you have invested for one purpose, added up. If you have put in ₹15,000 a month for six years and it is now worth ₹14 lakh, that ₹14 lakh is the corpus. It is the word we use so that "your savings", "your fund" and "your investment" do not come to mean three different things on three screens.
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The assumed returnThe yearly growth we use to work out the figures. It comes from the mix of investments your foundation can safely carry — a steadier mix is assumed to earn less — and it is an average across long periods, not something you get every year. Some years will beat it and some will fall well short.i
Why the number growsThings cost more each year, so the same goal costs more in the future than it does today. A ₹20 lakh car in ten years might cost around ₹36 lakh by the time you buy it, even though it is the same car. We work out the future price first, then what you need to put aside for it — otherwise you would be saving towards a price that no longer exists.i
Market-linkedThe money stays invested in mutual funds, so its value moves with markets — up in some years and down in others. Nothing here is a deposit, nothing is guaranteed, and no protection of your capital is promised. Every figure we show is a projection built on long-run assumptions, not a rate anyone has agreed to pay you.Two minutes, thirteen questions. It scores what your foundation can carry before it says anything about a fund. ARN-337898 · mutual fund distributor.
What actually happens
You build a corpus
A fixed amount every month, into a mix of funds your foundation can safely carry. This is the long part and there is no way around it — most of what the pot is eventually worth comes from the years it spent invested, not from the amount.
You start withdrawing
A set sum leaves the portfolio each month and lands in your bank account. Only that sum is sold; everything else stays invested and keeps working, which is the whole difference between this and moving the money to a deposit.
The withdrawal rises
It has to. ₹50,000 a month buys noticeably less after ten years and less than half as much after twenty-five, so a payment that never rises is a falling income with a steady number on it. Every figure above is priced to rise with prices.
Where this goes wrong
A bad first decade is not the same as a bad last one. Withdrawing from a portfolio that has just fallen means selling more units to raise the same rupees, and those units are not there to recover. The same poor decade twenty years later barely registers. This is the single largest risk in any withdrawal plan and no calculator on any website prices it.
Returns are not delivered evenly. An assumption of 8% a year is an average across decades, not an entitlement to 8% in the year you need it.
The corpus can run out. Draw more than the portfolio makes and it depletes — slowly at first, then not slowly. The figure above is priced to last exactly as long as you asked it to and no longer.
None of this makes the approach wrong. It makes the size of the corpus, and the discipline that builds it, the whole game.
If the pot already exists
Everything above starts from an income you want and works out what it takes to build it. If you have already built something and want it to start paying you, that is the other way round — a Monthly Withdrawal Plan. It takes a share of what the pot is worth each year and pays it out monthly, while the rest stays invested.
The Monthly Withdrawal Plan →Before any of this
An income plan sits on top of a foundation: an emergency fund, health cover, term insurance, and an EMI load that leaves something over. Most people who ask us about monthly income need one of those four before they need this page. Our free assessment takes two minutes and tells you which — and it will tell you plainly if the answer is “not yet”.
Take the free assessment →Conscious Wealth · ARN-337898 · AMFI-registered mutual fund distributor. Every figure on this page is illustrative, built on long-run assumptions, and is neither a forecast nor a guarantee. Mutual fund investments are subject to market risks; read all scheme related documents carefully. This page is educational and is not investment advice.