Article
Your retirement number: how to estimate it
Retirement planning starts with one figure: the corpus your expenses may need. How to estimate it step by step, and which assumptions move it most.
4 min read
Topic3 pieces · 8 terms
Retirement, as a number you can plan
A retirement plan comes down to a few numbers: what your life could cost in the year you stop working, how many years that money must last, and how inflation and withdrawals interact along the way. Time is the lever that matters most — and the one you can’t buy back later.
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Explainer
Withdrawal rates in retirement, explained
How much of a corpus can you draw each year? Why the answer depends on inflation, returns and time — and why rules of thumb from elsewhere need care.
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Using an SWP for retirement income
A systematic withdrawal plan turns a corpus into regular income. How it works, how withdrawal rates and sequence risk shape it, and how it compares.
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Glossary
Key terms
The words you’ll meet most often in this topic, defined in a sentence. Each links to the full definition.
Annuity
A contract, usually bought from a life insurer with a lump sum, that pays you a regular income for life or for a set period.
NPS
National Pension System
A voluntary, market-linked, defined-contribution retirement scheme regulated by PFRDA, in which contributions build a corpus for retirement.
NPS Tier 1 and Tier 2
The two NPS account types: Tier 1 is the core pension account with withdrawal limits; Tier 2 is an optional, flexible savings account.
SWP
Systematic Withdrawal Plan
An instruction to redeem a fixed amount from a mutual fund at regular intervals, used to draw a steady cash flow from an existing investment.
Inflation
The rate at which prices rise over time, which steadily reduces what a fixed amount of money can buy.
Real return
Your return after accounting for inflation — the growth in what your money can actually buy.
Asset allocation
How you divide money across asset classes such as equity, debt, gold and cash — the biggest single driver of a portfolio’s risk and behaviour.
Emergency fund
Money kept safe and easy to reach to cover several months of essential expenses if income stops or an unexpected cost arrives.
Tools
Work it out with your own numbers
Every calculator shows its assumptions and lets you change them. Results are illustrations, not promises.
Tools for retirement
- Retirement CalculatorEstimate the corpus your retirement may need and the gap to close.
- SWP CalculatorPlan regular withdrawals and see how long a corpus could last.
- Cost of WaitingHow delaying your start changes the monthly investment a goal may need.
- Inflation CalculatorWhat today’s money is worth tomorrow — and what tomorrow’s costs will be.
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When you’re ready, see what CompoundX offers here — how it works, what it involves and the risks to weigh first.
The National Pension System is a market-linked retirement scheme regulated by PFRDA. Contributions are invested by pension fund managers in a mix of equity, corporate bonds and government securities that you choose, or that adjusts automatically with age. Indian citizens within the eligible age range can join, including many non-resident Indians, subject to conditions. Employers can also contribute for their employees under the corporate model.
Partial withdrawals from the Tier 1 account are allowed for specified purposes — such as children’s education or marriage, buying a home, or treating certain illnesses — subject to conditions and limits. PFRDA relaxed the rules on premature exit for many non-government subscribers in December 2025. The optional Tier 2 account is more flexible. Because the rules change from time to time, check PFRDA’s current regulations before you plan around them.
At normal exit, part of the corpus can be taken as a lump sum and the rest is used to buy an annuity from a life insurer, which pays a regular pension. Under PFRDA’s December 2025 changes, many non-government subscribers can take up to 80% as a lump sum, and smaller corpuses qualify for larger or full withdrawal. How much of the lump sum is tax-free under current law should be checked separately.
It depends on your tax regime and on whose contribution it is. Under the old regime, your own contributions can qualify for deductions within limits, including an additional deduction specific to NPS. Under the new regime, the main benefit is a deduction for your employer’s contribution, up to a percentage of salary. Withdrawals and annuity income are treated separately. These rules sit in the Income-tax Act, 2025 and can change, so check current provisions or a tax professional.
Next step
Try it with your own numbers.
Every assumption is visible and yours to change. Results are illustrations, not promises.