Retirement Corpus: How Much Is Actually Enough?

Ask ten people how much they need to retire and you will get ten confident answers, most of them far too low. The reason is almost always the same: the calculation is done in today's money, without inflating expenses or accounting for the decades after the salary stops.

Step 1: inflate today's expenses

Start with your current monthly spending. If you spend ₹50,000 a month and retirement is thirty years away, inflation at 6% takes that to about ₹2,87,000 a month. Prices roughly double every twelve years at that rate, so thirty years is closer to six times.

Healthcare deserves its own line. Medical costs tend to rise faster than general inflation, and they form a larger share of spending as you get older. Adding a dedicated health buffer is not being pessimistic, it is being realistic.

Step 2: convert expenses into a corpus

An inflated monthly expense is not the corpus — it is a payment you have to make every month for twenty-five years with no salary coming in. To find the corpus, you discount those future payments at the return your retirement portfolio can realistically earn.

Using ₹2,87,000 a month, twenty-five years of retirement, and an 8% post-retirement return against 6% inflation, the required corpus works out to roughly ₹6.8 crore. Our retirement calculator does both steps and shows the number for your own inputs.

Why the figure looks so large

• Inflation compounds on the expense side. A 6% rise every year for thirty years multiplies your monthly need by nearly six.
• There is no new income. During your working life, shortfalls can be covered by a raise or a bonus. In retirement, they cannot.
• Retirement is long. Twenty-five years is not a rounding error; it is a third of a lifetime of expenses.
• The portfolio becomes conservative. You cannot hold an aggressive equity portfolio when you are withdrawing every month, so the return assumption is lower than during your earning years.

The levers that make it smaller

• Start early. A rupee invested at 25 has forty years to compound; the same rupee at 45 has twenty. Nothing else comes close to this advantage.
• Step up your SIP. Increasing the monthly investment with your income roughly doubles the eventual corpus compared with a flat SIP.
• Keep lifestyle inflation in check. Every ₹10,000 of extra monthly spending inflates into a much larger required corpus.
• Plan for post-retirement income. A pension, annuity, rent or interest reduces the corpus you need. Subtract reliable income before calculating.
• Retire a little later, if you can. Working an extra five years adds contributions and removes five years of withdrawals at the same time.

Review it every couple of years

The target moves. Salary changes, expenses change, markets move and your assumptions about retirement age may shift. Re-running the calculation every two years takes ten minutes and keeps the plan honest.

Once you know the corpus, the next question is what monthly investment gets you there — which is exactly what the target SIP calculator answers, and the step-up SIP calculator shows how much faster the number arrives if you increase the amount each year.