SWP Calculator
How long a corpus lasts when you draw from it every month.
Everything runs inside your browser. Your files never leave your device.
Result
Ask about SWP Calculator
Questions about what this tool does, which option to pick, or what it can and cannot handle.
The question you type here is sent to an AI provider to be answered — your files and whatever you put in the tool above are not, and the assistant cannot see them. Answers are generated and can be wrong. The tool itself is not guessing: it runs deterministic code on your device.
About the SWP Calculator
A systematic withdrawal plan reverses the usual arrangement: instead of paying in each month you take out, and whatever is left keeps earning. The question this answers is whether the corpus survives the plan, and it answers it in months rather than in reassurance.
The mechanics matter. Each month the balance earns its return first, then the withdrawal comes out. Early on the return covers most of the draw and the balance barely moves; later, if the draw exceeds what the balance earns, the shortfall eats into capital and the erosion accelerates. That acceleration is why a plan can look comfortable for twelve years and then collapse in three, and why the year-by-year table is worth reading past the first few rows.
The escalation field exists because a fixed withdrawal is not a fixed standard of living. Thirty thousand a month buys materially less after fifteen years, so a plan that never raises the draw is quietly planning to become poorer. Setting the escalation to your expected inflation rate is the honest version of the question, and it usually shortens the life of the corpus considerably.
If the corpus runs out before the term, the tool says so in months rather than rounding it away, and the result reads as a warning instead of an outcome. That is deliberate: the useful answer to "will this last" is not a number with a reassuring shape but the specific month in which it fails.
Sequence risk is the part no steady-rate model can show. A run of poor years at the start of a withdrawal plan does far more damage than the same years later, because the withdrawals are being taken from a shrunken base.
How to use it
- 1Enter the corpus you will start with and the amount you need each month.
- 2Set the return you expect on the balance that stays invested — lower than a growth portfolio, since you are drawing from it.
- 3Set the yearly escalation to your inflation assumption rather than leaving it at zero.
- 4Check the month the corpus runs out, if it does, and reduce the draw until it survives the term.
Questions
- What withdrawal rate is safe?
- There is no single figure, but plans drawing much more than six or seven per cent of the corpus a year tend to fail over long horizons once inflation is included. Use the escalation field and read the exhaustion month rather than trusting a rule of thumb.
- Why does the order of returns matter if the average is the same?
- Because withdrawals crystallise losses. A bad first year means you sell more units to fund the same draw, and those units are never there for the recovery. Two portfolios with identical average returns can end very differently depending on when the bad years fell.
- Is the withdrawal taxed?
- Each withdrawal from a fund is partly capital and partly gain, and only the gain is taxable, at a rate that depends on the fund type and holding period. This model works in gross figures.
- How is this different from a monthly income scheme?
- A monthly income scheme pays a fixed rate and returns your capital intact at the end. Here the capital is being consumed, which is why the plan can end early — and also why it can leave more behind if returns are good.