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Summary: Let’s say you’ve just retired with Rs 2 crore in the bank. You want to enjoy life, maybe travel a bit, help your kids and live comfortably. The plan? Withdraw Rs 1 lakh every month to fund your lifestyle. Simple enough, right? But here’s the million-rupee question: Will your corpus last your lifetime? And if it doesn’t, how much money can you withdraw from the Rs 2 crore corpus to sustain at least 30 years of your retirement life? Let’s find out…
Let’s say you’ve just retired with Rs 2 crore in the bank. You want to enjoy life, maybe travel a bit, help your kids and live comfortably. The plan? Withdraw Rs 1 lakh every month to fund your lifestyle.
Simple enough, right? But here’s the million-rupee question: Will your corpus last your lifetime?
The tempting illusion
If your investments earn 8 per cent a year, assuming you split equally your retirement in equity and debt, and you withdraw just 6 per cent (Rs 12 lakh annually), it feels like you’re living within your means. But inflation, the silent wealth killer, throws a spanner in the works.
At 6 per cent inflation, your cost of living doubles in about 12 years. So, withdrawing a flat Rs 1 lakh every month means you’re slowly reducing your purchasing power.
Hence, to keep your lifestyle constant, you’ll need to increase that Rs 1 lakh every year — by 6 per cent.
The real math
Let’s run the numbers with two key assumptions:
- Your investments grow at 8 per cent annually
- Inflation averages 6 per cent annually
Now, let’s solve for how long your Rs 2 crore corpus can fund a Rs 1 lakh monthly withdrawal, adjusted for inflation (i.e., the amount increases every year).
The result? The Rs 2 crore corpus would run out in the 21st year.
Basically, that’s not enough if you retire at 60 and live till 85 or 90. That’s the risk.
What if you want your money to last 30 years?
If you want your Rs 2 crore retirement kitty to stretch across three full decades, from, say, age 60 to 90, you can’t simply withdraw Rs 1 lakh every month and hope for the best.
The maths tells you that instead of Rs 1 lakh, you should withdraw around Rs 72,500 per month in the first year, and then increase that amount by 6 per cent each year to keep up with inflation.
On paper, this works. The numbers line up. The money lasts.
But here’s the thing: life doesn’t run on Excel sheets.
You’re not going to sit there every April 1st, increasing your withdrawals by exactly 6 per cent. Neither will the market deliver neat, predictable 8 per cent returns year after year.
And your expenses won’t inflate in a straight line.
So, instead of clinging to the illusion of precision, aim for a safe starting point.
What should you do instead?
- Know your real rate of return: Always plan using inflation-adjusted returns, not nominal ones.
- Always have a buffer: Instead of sticking to a flat number, leave a buffer for the ups and downs, in the markets, and in your life. Because retirement is not a formula; it’s a journey.
- Split your portfolio wisely: Keep short-term income needs in stable, low-risk debt instruments; long-term needs should ride on equity. We suggest that retirees should invest 33 per cent to 50 per cent of their retirement nest egg in equity.
- Plan for at least 30 years post-retirement: Life expectancy is rising, and your money needs to rise with it.
Our take
Yes, retiring with Rs 2 crore is mathematically viable. But that’s just the arithmetic. Real life throws in far more variables — and none of them are small:
- Medical expenses can shoot up dramatically in your silver years
- Family emergencies, caregiving needs or extended dependency
- Children’s education, higher studies, or weddings
- Or even lower-than-expected investment returns
So, treat this as a starting point, not the whole plan.
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This article was originally published on July 31, 2025.
Disclaimer: This content is for information only and should not be considered investment advice or a recommendation.
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