Retirement fund
What has to exist on the day work stops — counting inflation and the years after — and what to set aside each month from now.
Four assumptions decide this — inflation, two returns, and how long you live — and none is known. The corpus is a direction, not a target; the monthly amount is the thing to act on.
Spending रू 40,000 a month today becomes रू 2,29,739.65 a month in 30 years at 6.00% inflation — and keeps rising for 25 more years. Paying all of that from a fund earning 7.00% needs रू 6,17,18,782.66 on the day you stop.
That sounds impossible; in today's money it is रू 1,07,45,865.33. Starting now, रू 22,915.44 a month at 10.00% gets there — most of it from growth, which is the reason to start now rather than at forty-five.
| At age | Fund | Of target |
|---|---|---|
| 35 | 25,97,159.05 | 4% |
| 40 | 60,47,633.57 | 10% |
| 45 | 1,17,24,730.13 | 19% |
| 50 | 2,10,65,307.82 | 34% |
| 55 | 3,64,33,443.74 | 59% |
| 60 | 6,17,18,775.10 | 100% |
- Enter your SSF or provident fund balance in "already saved" — for most salaried people it is the largest piece and changes this a lot.
- Try inflation at 8% and the return one point lower. If the monthly amount is still possible, the plan is robust.
- Inflation 6.00% every year, before and after retirement; spending rises with it.
- Savings earn 10.00% while working and the fund earns 7.00% after — the real return after retirement is 0.94%.
- Each retired year is paid from the fund at its start; nothing else — no pension, no SSF payout, no rent, no children — unless it is in "already saved".
- Money runs out exactly at the plan-until age. Plan past what you expect.
A worked example
The form starts with these figures (in NPR) so you can see how it works before typing your own. They are made up — nobody's real numbers appear here.
Questions people ask
Six crore? That cannot be right.
It is inflation, not lifestyle. Forty thousand a month today is 2.3 lakh a month in thirty years at 6%, and it keeps rising for twenty-five more. In today's money the fund is about one crore — the page shows both.
Why is the return after retirement lower?
Because the money can no longer be replaced. A fund that falls 30% at 62 has no salary to refill it, so it sits in safer places that pay less.
What about SSF or a pension?
Put the current balance in "already saved"; a monthly pension reduces the spending the fund must cover — subtract it from the monthly figure. Both usually change the answer a great deal.
I am 45 and have started nothing.
Then the monthly amount is high, and the honest choices are: retire later, spend less in retirement, or both. Enter the real numbers; the page does not soften them.
Do you keep what I type here?
No. The figures are used to work out the answer and are not stored, and never appear in the page address.
These are estimates. The figures depend entirely on the numbers you enter and on assumptions that are listed on every result. They are not financial advice, and a bank, employer or authority may use different rules. Check anything important with them before you decide.
We do not keep your figures. Salary, debt and savings you type here are used to work out the answer and are not stored, and never appear in the page address. The only thing remembered is your country and language choice (a small cookie), so the currency can be suggested next time — never a figure you typed. Anonymous counters record that a calculation happened, not what it was.