Retirement planning usually starts with a number someone else picked. One crore, two crore, five. The number that matters is smaller and closer to home: what your own month costs.
This does the whole job in one place. What your life will cost by the time you stop working, how much you need saved to pay for it, and what to put away each month from next month to get there.
How we got there
Four steps, one after the other.
How the cost of one month climbs
One bar for each year from now until you retire.
Why the Number Is So Big
Two things pile on top of each other. Your monthly cost keeps climbing for twenty five years, and then your savings have to pay for another twenty or thirty years with no salary coming in.
The number is meant to be uncomfortable. Planning on today’s prices feels much better, and it is the plan that runs out of money.
Four Things Worth Knowing
- Taking out 4% a year is not an Indian rule. It came from American research on a thirty year retirement in American markets. Prices here have risen faster, so taking out less is safer. Try 3.5% and see what it does.
- The growth rate is the shakiest number here. Everything else is just sums. Drop it from 12% to 9% and watch the monthly saving jump. If you doubt one number, doubt that one.
- Your prices are not the ones in the news. Doctors, medicines and help at home go up faster, and they take a bigger share of your money as you get older.
- Time does more of the work than the amount. Start five years earlier and the same target costs far less every month. Time is the one thing nobody can give back to you.
When you have a monthly figure you can commit to, pay yourself first covers why the date matters more than the amount, and the savings rate calculator shows what that share of your pay does to the year you could stop.
This calculator is for learning. It is not personal financial advice. Inflation, return and the withdrawal rate are assumptions you choose here, not forecasts, and real markets do not move in straight lines. It assumes you keep buying the same things, that your savings keep growing after you retire, and it ignores tax on the money you take out. A real plan has to deal with all three. For advice about your own retirement, speak to a SEBI-registered investment adviser.