What is Withdrawal Rate?
Background
Your withdrawal rate is the percentage of your corpus you withdraw in the first year of retirement. It is one of the most important levers in determining whether your money lasts.
Explanation
A higher withdrawal rate gives more income but increases the chance of running out; a lower rate is safer but requires a larger corpus. In India, planners often use 3–3.5% as a conservative starting range, especially for long retirements and FIRE scenarios.
Example
With a ₹2.5 crore corpus and a 3% withdrawal rate, you take out ₹7.5 lakh in year one (about ₹62,500 per month). That number then increases with inflation each year. Tools that show year-by-year corpus depletion let you see whether this is sustainable.
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