How to Earn ₹1 Lakh per Month from a ₹1 Crore Retirement Corpus — The Smart Way

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You’ve worked for decades and built a retirement corpus of ₹1 crore — now the question is, how do you make it last while generating a steady income? Many assume ₹1 crore is more than enough, but inflation, lifestyle costs, and longevity can quickly erode purchasing power. Let’s explore practical, sustainable ways to draw a monthly income — without exhausting your nest egg too soon.

Step 1: Understand the “4% Rule”

Globally, retirees follow the 4% rule — withdrawing 4% of their corpus each year (inflation-adjusted) to make it last 25–30 years.

• Example: ₹1 crore x 4% = ₹4 lakh annually or ₹33,000/month.
  This is conservative but ensures long-term safety even if markets fluctuate.

Step 2: Align Returns with Inflation

The magic lies in balancing returns and inflation.

• At 6% return & 4% inflation, ₹1 crore can sustain ₹50,000/month for nearly 20 years.
• At 8% returns, that same ₹50,000 can last 25+ years.
• At 10%, ₹50,000 monthly could stretch for over 40 years — but ₹1 lakh/month depletes it in ~11 years.

Key takeaway: Higher withdrawals rapidly reduce corpus life.

Step 3: Build a Hybrid Portfolio

A diversified retirement plan might look like this:

Asset Type	Allocation	Expected Return	Role
Equity (Mutual Funds)	40%	10–12%	Growth, inflation hedge
Debt (Bonds, FDs)	40%	6–7%	Stability, regular income
Cash & Liquid Funds	20%	4–5%	Emergency buffer

Rebalancing every 2–3 years maintains safety and returns.

Step 4: Use Systematic Withdrawal Plans (SWP)

Instead of redeeming large chunks, use SWPs from balanced or hybrid mutual funds.

• Offers predictable monthly cash flow.
• Gains are taxed more efficiently than traditional FDs.
• Allows partial equity exposure for long-term growth.

Step 5: Plan for Longevity

Thanks to better healthcare, retirees today easily live into their 80s and 90s. Always plan for at least 25–30 years post-retirement. Reassess expenses, health costs, and lifestyle every 3 years.

Step 6: Avoid Common Mistakes

❌ Overspending in early retirement.
❌ Investing too conservatively (inflation risk).
❌ Ignoring tax efficiency.
❌ Lack of periodic review.

Conclusion

With prudent withdrawals, balanced investing, and inflation-aware planning, ₹1 crore can indeed generate a comfortable monthly income — but ₹1 lakh per month sustainably requires higher returns or supplemental income sources.

“Want to build a retirement strategy tailored to your goals? Connect with Finogent today.”