Mutual fund calculator: How much SIP you need to get ₹2.5 lakh monthly income


Mutual fund calculator: Systematic Investment Plan or SIP helps mutual fund investors create a big amount in the long term by investing small smalls every month. However, according to investment experts, one should keep rate of inflation in mind while making investment and then fix the investment goal. If an investor follows this thumb rule, he or she will be able to beat the inflation during the investment period. For example, if an investor is investing for its post-retirement financial needs, then he or she will have invest in such mutual fund options where it would get a potential return of beating the inflation by a margin.

On how much a person will require per month after retirement, Sebi registered tax and investment expert Jitendra Solanki said, “In a middle class family, a retired person needs around 40,000 per month. Assuming inflation growth at 6 top 6.5 per cent per annum, this 40,000 monthly expense will go up to around 2.5 lakh per month after 30 years or post-retirement.”

Solanki said that at the age of 30, an earning individual is expected to start saving for its post-retirement life. But, at this age, the professional is expected to passing through the nascent phase of its career. So a lump sum amount might not be available for investing. In that case, the professional is advised to invest in mutual funds SIP.


On how much monthly SIP will be required to get 2.5 lakh monthly, Pankaj Mathpal, Founder & CEO at Optima Money Managers said, “To get 2.5 lakh per month, an individual requires 5 crore at the age of sixty. If an investor starts investing in mutual fund SIP at the age of 30, then it will get 30 years for investment and create 5 crore corpus. However, keeping the risk appetite of an investor in mind, I am keeping the least possible mutual fund SIP return of 8 per cent and an annual step up of 10 per cent, an investor will have to start investment with 11,000 in monthly SIP for next 30 years.”

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On how to get 2.5 lakh monthly income from this 5 crore maturity amount generated by mutual funds SIP Pankaj Mathpal of Optima Money Managers said, “One needs to keep a tab on inflation post-retirement as well. So, if a senior citizen, who has 5 crore in hand, can invest the amount in SWP for next 20 years. Assuming inflation of 6 per cent and return of 8 per cent post-retirement, the retired individual will be able to get 2.5 lakh per month for next 20 years from this single investment using 4 per cent annual withdrawal from the SWP.”

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