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Market Intelligence › Basic Terminologies
A simple framework of today's expenses, inflation and the withdrawal rate
Published by The Retail Trader · AUG 03, 2026 · Retirement & Insurance
The very first question in retirement planning is a number — how much you need. Working it out is not complicated, but three things have to be put in honestly.
First, today's annual expenses — what you actually spend, not what you think you spend.
Second, how many years remain until retirement and what inflation will do in that time. Third, how many years you need to plan for after retirement — and this should always be assumed to be longer than you hope.
The size of the corpus is inversely related to the withdrawal rate:
• The higher the percentage you withdraw each year, the sooner the corpus runs out.
• A conservative withdrawal rate means a bigger corpus, but more safety.
• The market in the early years of retirement matters a great deal.
• Health expenses rise with age, so they should be a separate line.
This number looks big the first time you see it, and people abandon the calculation altogether. Stopping at the sight of a big number is the costliest decision — because in this plan time does the most work, and it shrinks every year.
This article is for education only — it is not a buy or sell recommendation, makes no claim of a guaranteed return, and is not advisory. Rules, rates and mechanics are changed from time to time by the exchanges, SEBI and RBI, so verify every number yourself with your broker or the official source.