How this retirement calculator works
Retirement planning comes down to one question: will your money outlast you? This calculator projects your expenses forward with inflation, works out the corpus that can fund them for your whole retirement, and compares it with where your current savings are heading.
Project your expenses
Today’s monthly expenses are grown at inflation to the year you retire. At 6% inflation, ₹1 lakh a month today becomes about ₹5.7 lakh a month in 30 years.
Size the corpus
The corpus must pay those expenses every month, rising with inflation, from retirement to your life expectancy, while the balance keeps earning a return.
Close the gap
Your existing savings and SIP are projected forward. Any shortfall becomes the extra monthly SIP, flat or stepping up every year, that you need to start today.
The maths behind it
Your monthly expenses at retirement:
The corpus needed is the present value, at retirement, of every monthly expense until your life expectancy. Expenses rise with inflation each year, and the corpus earns the post-retirement return:
Your current savings and SIP grow at the pre-retirement return. The shortfall is divided by the growth of ₹1 invested every month to give the SIP you need.
What is a FIRE number?
FIRE stands for Financial Independence, Retire Early. The popular rule of thumb is 25 times your annual expenses, based on withdrawing 4% a year. That rule comes from US data. With India’s higher inflation, many planners prefer 30 to 35 times, which is why the calculator also shows the full, inflation-adjusted figure.
Frequently asked questions
How much money do I need to retire in India?
It depends on your expenses, the years until retirement, inflation and how long retirement lasts. As a rough guide, many people need 25 to 35 times their annual expenses at retirement. This calculator works out your exact figure.
What is the FIRE number?
Your FIRE number is the corpus at which your investments can cover your expenses for life. The simple version is 25 times your annual expenses, which assumes a 4% yearly withdrawal.
What inflation rate should I assume?
Around 6% is a reasonable long-term assumption for household expenses in India. Healthcare and education have historically risen faster.
Why is the post-retirement return lower?
In retirement, more of the corpus usually moves into debt and hybrid funds to reduce volatility while you depend on the money. That lowers the expected return.
What life expectancy should I use?
Planning to 85 or 90 is sensible. Running out of money late in life is a far bigger risk than leaving some behind.
Does this include EPF, PPF and NPS?
Add the current value of any savings meant for retirement, including EPF, PPF and NPS, to "Existing retirement savings". The calculator grows them at the pre-retirement return.