A ₹10 crore retirement corpus sounds safe. For most people, it is the wrong target. Here is how to calculate the actual number based on your expenses, inflation, and returns.
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A ₹10 crore retirement corpus sounds like a safe target. For most people, it is the wrong number to chase.
"Retirement planning starts with a simple question: How much monthly income will you need when you stop working?" said Vishwajeet Goel, head of Pensionbazaar. "The answer isn't based on today's expenses alone – it must account for inflation, life expectancy, and the returns your retirement corpus can generate."
The calculation starts with current household expenses, excluding temporary commitments like EMIs or children's education costs that will not carry into retirement. A 30-year-old planning to retire at 60, assuming 5% annual inflation, will see monthly expenses rise from ₹70,000 today to roughly ₹3 lakh at retirement.
That inflation-adjusted number determines the corpus. For a monthly requirement of ₹3 lakh at retirement, assuming a 7% post-retirement return, the required corpus is about ₹5.2 crore – roughly half the ₹10 crore figure that circulates as conventional wisdom.
The monthly investment needed to reach that target depends on the return assumption during the accumulation phase. At a 15% CAGR, the same 30-year-old would need to invest roughly ₹9,200 per month. The same goal at a 10% CAGR would require a much larger monthly commitment.
Seven variables drive the calculation: current lifestyle expenses, age and retirement timeline, inflation assumptions, pre-retirement investment returns, post-retirement returns, life expectancy, and additional goals such as healthcare, travel, or major purchases. A change in any one assumption – a 1% lower inflation rate, a longer life expectancy – shifts the required corpus meaningfully.
The ₹10 crore target is a round number, not a personalised answer. The right number is the one that covers your specific expenses, inflation path, and return assumptions. That number will be different for almost everyone.
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