Monthly Income Calculations: Age 40 and want Rs 1 lakh/month at retirement? Know your monthly SIP and one-time investments to achieve this goal

Retirement Planning: An investor eyeing to achieve a regular income post retirement needs to know their retirement corpus amount if they want to achieve it through an investment. Inflation and investment return can be key factors to determine the corpus and the monthly income they want to get post retirement.  

Shaghil Bilali | Jan 21, 2025, 06:59 PM IST

Retirement Planning: Everyone looks for a comfortable retirement life. They want to see themselves bear expenses and not depend on anyone. It gives them a feeling of financial freedom. But everyone looking for a fruitful retirement life should build income sources or make investments during their active service years. If they are looking to generate post-retirement monthly income through investment, they must know the inflation-adjusted estimated corpus, return on their investment(s), and how much amount they need to achieve that financial goal. Here, we take you through the different aspects of retirement planning and know what can be one-time and monthly SIP investments for a 40-year-old who wants to get an inflation-adjusted Rs 1 lakh monthly income at 60 years of age for the next 20, 25, or 30 years (till 80, 85, or 90 years of age).
Photos: Unsplash/Pixabay/Pexels
Disclaimer: This is not investment advice. Do your own due diligence or consult an expert for financial planning.) 

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What is retirement planning?

What is retirement planning?

Retirement planning is necessary to create a retirement corpus or generate income sources for post retirement life. The corpus or the income should be enough to help you sustain yourself through life. The amount should be inflation-adjusted.

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Why is retirement planning important? 

Why is retirement planning important? 

The purpose of retirement planning is to achieve or maintain financial freedom in their retirement life. There are chances that one may not receive any pension, financial aid, or help from others for their monetary needs post retirement. In such a situation, they need to have income sources or a corpus so that they don't need to depend on others. 

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How much amount is required for retirement planning?

How much amount is required for retirement planning?

One should know when they want to retire and till what age they require a corpus. Based on the current expenses, an inflation-adjusted corpus can be calculated. 

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How much amount is required for retirement planning?

How much amount is required for retirement planning?

But, post retirement, if someone has other liabilities, such as a loan, or responsibilities, such as their children's marriage, they should also incorporate those expenses in their retirement corpus.

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How can retirement corpus be created?

How can retirement corpus be created?

It can be created through generating income sources or creating a retirement corpus through investments.

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What can be investments?

What can be investments?

It can be a mix of market-linked and non-market-linked investments. While market-linked options can provide growth to the retirement corpus, non-market-linked can provide some safety. However, post retirement, one can invest in fixed income options or can have a little exposure to equity based on their risk appetite. 

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What should be investment horizon?

What should be investment horizon?

The investment horizon should be from the current age till retirement age. Based on that duration, one can calculate their required investment return and plan their investment accordingly. 

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Retirement corpus calculations

Retirement corpus calculations

We will calculate the retirement corpus required for a 40-year-old at the age of 60 for getting an inflation-adjusted Rs 1 lakh a month for the next 20, 25, or 30 years. The annualised return on the investment pre retirement will be 12 per cent, while post retirement, it will be 6 per cent. We will also tell the one-time (lump sum) and SIP investment required to get the Rs 1 lakh monthly income. We are assuming that the person has 0 investments for the retirement planning. The inflation rate will be 6 per cent.

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Corpus required to get Rs 1 lakh monthly income from ages 60 to 80 

Corpus required to get Rs 1 lakh monthly income from ages 60 to 80 

The estimated monthly expenses at 60 years of age will be Rs 3,20,714, and the estimated corpus required will be Rs 7,69,71,360.

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One-time and monthly SIP investments to achieve that target

One-time and monthly SIP investments to achieve that target

The estimated lump sum amount will be Rs 79,79,372, while the estimated SIP amount will be Rs 77,037.

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Corpus required to get Rs 1 lakh monthly income from ages 60 to 85 

Corpus required to get Rs 1 lakh monthly income from ages 60 to 85 

The estimated corpus required in such a situation will be Rs 9,62,14,200.

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One-time and monthly SIP investments to achieve that target

One-time and monthly SIP investments to achieve that target

The estimated lump sum amount will be Rs 99,74,215, while the estimated SIP amount will be Rs 96,296.

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Corpus required to get Rs 1 lakh monthly income from ages 60 to 90 

Corpus required to get Rs 1 lakh monthly income from ages 60 to 90 

The estimated corpus required in such a situation will be Rs 11,54,57,040.

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One-time and monthly SIP investments to achieve that target

One-time and monthly SIP investments to achieve that target

The estimated lump sum amount will be Rs 1,19,69,058, while the estimated SIP amount will be Rs 1,15,556.

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