Pritas

Helping Indians make smart money decisions. Free tools, AI portfolio & market dashboards, intelligent doc vault, NISM & IBBI exam prep & more.

[Pritas @FinancePritas]

8/
One honest note: the calculator models a constant return, so it gives you the baseline — ₹1 crore at ₹60,000/mo and 10% flat runs out in year 20.

The ordering above I ran separately. Start with the baseline:

https://t.co/16uoAlJbU4

[Pritas @FinancePritas]

6/
What actually survives a bad start is the withdrawal rate. Nothing else comes close.

Same ₹1 crore, same brutal first 3 years:

₹45,000/mo → year 16
₹40,000/mo → year 19
₹35,000/mo → year 23
₹30,000/mo → all 30 years

3.6% is what held.

[Pritas @FinancePritas]

7/
Which flips the question you should be asking.

Not "what will my corpus return?" but "what does my corpus survive?"

₹60,000/month for 30 years needs ₹2 crore, not ₹1 crore — if you want it to hold through a bad first 3 years.

The gap is the insurance premium.

[Pritas @FinancePritas]

5/
Now the part that surprised me.

The standard advice is "keep 2-3 years of expenses in cash so you don't sell in a crash."

I modelled it. A 3-year cash bucket moved depletion from year 16 to year 17.

One year. For ₹16 lakh parked at 6%.

[Pritas @FinancePritas]

4/
And this isn't only about greedy withdrawal rates.

Drop to ₹45,000/mo — 5.4%, well inside what most people call safe:

Bad years last: survives 30 yrs, ₹3.92 crore left over
Bad years first: dead in year 16

Same returns. ₹3.92 crore, or nothing.

[Pritas @FinancePritas]

2/
The setup, so you can check it.

Three bad years: -25%, -10%, +2%
The other 27 years: 12.72%

Compounded, both orders average exactly 10% a year. Identical returns, identical average.

Put the three bad years last → year 30.
Put them first → year 11.

[Pritas @FinancePritas]

3/
Why order matters once you're withdrawing:

In -25% year you still need ₹60,000 a month. So you sell units at the bottom to buy groceries.

Those units are gone. They aren't there for the 12.72% recovery.

A crash while accumulating is paper. While withdrawing it's permanent.

[Pritas @FinancePritas]

1/
₹1 crore corpus. ₹60,000/month, rising 6% a year for inflation.

I ran the same 30 annual returns twice. Same numbers. Only the order changed.

Order A: money lasts 30 years.
Order B: gone in year 11.

Nothing changed except when the bad years showed up. 🧵

[Pritas @FinancePritas]

8/
₹1,17,277 → ₹42,340. A 64% cut, and not one extra percent of assumed return.

Run your own four. One goal at a time, then add them up:

https://t.co/LZEuz6yYWr

[Pritas @FinancePritas]

1/
House in 7 years. Child's education in 12. Retirement in 25. A car in 3.

I ran all four through the target-corpus calculator. Four separate required SIPs:

₹35,585 + ₹32,917 + ₹19,478 + ₹29,297

= ₹1,17,277 a month.

The budget was ₹40,000. 🧵

[Pritas @FinancePritas]

7/
So the fix isn't a better fund. It's timelines and sizes.

Car: ₹6L used, 6 yrs → ₹7,304
House: ₹20L DP, 12 yrs → ₹9,540
Education: 12 yrs → ₹12,493
Retirement: 25 yrs → ₹13,003
(all with a 10% annual step-up)

₹42,340. Same four goals.

[Pritas @FinancePritas]

8/
Step-up SIPs work. Just not for the reason stated, and not at 10% unless your salary cooperates.

Full comparison at 10, 20 and 30 years, plus when flat is the right call:

https://t.co/eYkd5zSBBW

[Pritas @FinancePritas]

1/
₹10,000/month SIP, 12% return, 20 years.

Flat: ₹98.9 lakh
Step up 10% a year: ₹1.97 crore

Exactly 2x, and both pay the same ₹10,000 in year one.

Everyone stops the thread here. The interesting part is what happens next. 🧵

[Pritas @FinancePritas]

7/
So match the step-up to the raise you actually expect.

6% step-up, same ₹10,000 start, 20 years: ₹1.46 crore. Still 1.47x flat.

Year-20 SIP: ₹30,256 — against an income that also tripled. The SIP never gets heavier.

That one you'll finish.