I Am Retiring With A Corpus of Rs 1.20 Cr In 2026. How Much Should I Invest To Get Rs 25,000 Monthly?

If someone is retiring with a corpus of Rs 1.20 crore in 2026 and wants a monthly income of Rs 25,000. Now, if you look into the basics, Rs 25,000 per month means Rs 3 lakh per year, and if you consider a fixed deposit typically offering a 6% p.a. interest, dividing Rs 3 lakh by 6% gives you the investment number of Rs 50 lakh.

So if you invest Rs 50 lakh in an FD offering 6% p.a. interest, you can generate an annual interest of Rs 3 lakh. It sounds easy and will also be quite tax-efficient because Rs 3 lakh per year doesn't really put you into the tax net. But while this calculation may look simple, it's actually not.

As you grow older, the cost of living will rise. Inflation will impact the cost of everything you consume. So if you need Rs 25,000 today, chances are you may need Rs 50,000 after 8-10 years, maybe even earlier, and this number continues to grow even further.

So you cannot plan your retirement assuming that you will withdraw Rs 25,000 forever for your survival. Hence, retirement planning cannot be based on a fixed withdrawal number; it must also consider increasing your expense stream over time while keeping your base corpus intact and growing.

"Now, if we do reverse-engineering here. As you already have a corpus of Rs 1.20 crore, and if you invest the entire amount and withdraw only Rs 3 lakh a year, the withdrawal rate will be just about 2.5%. That sounds very manageable. But you also have to add an inflation rate, which is roughly around 5% in practical terms, and with this, your investments need to earn around 7.5% per year (2.5% withdrawal + 5% inflation) after tax and expenses for you to comfortably sustain your lifestyle," said Mr. Sachin Jain, Managing Partner, Scripbox.

And this is exactly where only fixed deposits fall short, because getting a stable 7.5% net return from FDs alone is not practical today. This means you will have to divide your money across different types of investments.

So, to achieve a 7.5% return, you can't rely entirely on fixed deposits. You will have to divide your money across different types of investments.

"Ideally, 30% of your money should stay in very safe fixed-income products so your next three to five years of expenses are fully covered without worrying about the markets," recommended Sachin Jain.

"After that, about 40-50% can be kept in hybrid funds, which give you a blend of growth and stability and can be used once your fixed-income buffer is over. The remaining 20-30% can be invested in equities so that this portion can continue growing quietly because you may not even need to withdraw during your lifetime and this portion can continue growing quietly," Sachin Jain further added.

Another important thing is to be prepared for emergencies. After retirement, you will not be getting a salary anymore, so you must keep some money protected for medical and unexpected costs. And if you have dependents, having adequate life insurance ensures that they will be financially secure if something happens to you.

"So yes, having Rs 1.20 crore is a strong starting point, but the real difference comes from how wisely you invest and manage it. Retirement planning is not just about earning Rs 25,000 a month today - it's about making sure that Rs 25,000 keeps up with rising prices and supports you comfortably for many years ahead," commented Sachin Jain.

Given all this, even though you already have a good corpus, the key is to invest it wisely. Though a simple approach is to keep at least 30% of money in a safe fixed-income investment method.

"This will cover the next three to five years of your day-to-day expenses without any tension. The next 40-50% can go into hybrid funds, which you can start using after finishing the fixed-income portion. The remaining 20-30% can be placed in equity, which you may not need during your lifetime, so it can grow steadily and eventually become part of your legacy assets," Sachin Jain stated.

That is how you can plan to invest your corpus to meet your long-term goals and requirements.

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