Monthly income from one-time investment: Rs 4,9999 mutual funds one-time investment can generate Rs 88,000 per month for 30 years

Monthly income from one-time investment: Everyone seeks a happy retirement phase where they have their own financial resources to cover their own expenses. They don't have to rely on others' stages. Such income may be passive, which may be due to their investments when they were young. The corpus may be generated through a combination of market and non-market-related investments. If an investor has a long-term investment scope, it can also be created by investment tools such as mutual funds.

Investors can group together one-time investments of mutual funds, where they can accumulate a corpus, as well as a systematic withdrawal plan (SWP), which can be used to withdraw monthly income over the years.

Here we tell you how a one-time investment of Rs 4,99,999 mutual fund can help people generate a retirement corpus, which can help them earn an estimated monthly income of around Rs 87,215 for 30 years!

What is a one-time investment in mutual funds?

Mutual funds have two types of investments – one-time and system investment plans (SIP).

The investor invested all the amounts in one go.

They purchase net worth (NAV) or units through investment.

Since they buy all units at once, their prices and growth are similar.

How does SWP work?

SWP is a way to systematically withdraw large sums from mutual funds.

In SWP, a one-time payment can be invested in a mutual fund program and the fund house is instructed to provide a fixed monthly income from the same corpus.

The foundation sells NAV to provide fixed income.

So while investors withdraw a sum every month, their investments are growing.

Calculation of the story

There will be 2 stages in the calculation.

In the first phase, we will show how a one-time investment of Rs 4,99,999 in a mutual fund can create a retirement corpus within 30 years.

In the second phase, we will show how the same investor withdraws an estimated monthly pension of approximately Rs 87,215 from the same retirement corpus.

So if investors are 25 years old, they may generate a corpus until they are 55 years old and may withdraw estimated monthly incomes of nearly Rs until they are 85 years old.

Retirement Corpus from one-time investment from Rs 4,99,999

If the annual growth rate of investors in this investment increases by 12%, the estimated capital gains of the investment will be Rs 1,44,79,932 and the estimated corpus will be Rs 1,49,79,931.

Retirement Corpus Tax

Since we will invest this money in another fund of SWP, we need to pay taxes on mutual fund plans when redeeming them.

Long-term Capital Gains (LTCG) tax will apply to these capital gains.

Investors will receive a capital gain waiver of Rs 1,25,000.

After deducting that amount, the remaining capital gains will be taxed at 12.5%.

After-tax corpus

After exemption of Rs 1,25,000, the taxable capital gain will be Rs 1,43,54,932.

With a 12.5% ​​LTCG tax, the estimated tax rate for the corpus is Rs 17,94,366.5.

Therefore, the after-tax estimated corpus will be Rs 1,31,85,564.5.

SWP Investment

Rs 1,31,85,564.5 will be an estimated investment for SWP. We will invest this amount in a hybrid or debt mutual fund, from the expected annual return of 7%.

Monthly income from corpus for 30 years

The corpus can generate an estimated monthly amount of Rs 87,215 per month for 30 years.

Total revocation amount within 30 years

The estimated total amount that can be withdrawn from this corpus within 30 years is Rs 3,13,97,400. The remaining amount after withdrawing this corpus is Rs 165.