Retire Rich: How to retire with a corpus of over Rs 1 crore (2024)

FAQs

Retire Rich: How to retire with a corpus of over Rs 1 crore? ›

The answer will depend on your expense pattern. If your monthly expense is ₹25,000 post-retirement, having 1 crore can be sufficient. But, if you plan on having additional expenses, you must build a larger corpus.

The answer will depend on your expense pattern. If your monthly expense is ₹25,000 post-retirement, having 1 crore can be sufficient. But, if you plan on having additional expenses, you must build a larger corpus.

In fact, a recent survey found that investors believe they'll need at least $3 million to retire comfortably. But retiring with $1 million is still possible, even as early as age 55, if you're smart about it. It will require some careful planning since you'll have to wait 10 years for Medicare, but it can be done.

This requires a significant corpus, and the exact amount can only be calculated once additional information is available. For example, if your inflation-adjusted monthly expenses are ₹2 lakh (assuming ₹1 lakh per month today), you would need approximately ₹10 crore as your retirement corpus to start with!

For example, if you have retirement savings of $1 million, the 4% rule says that you can safely withdraw $40,000 per year during the first year — increasing this number for inflation each subsequent year — without running out of money within the next 30 years. Of course, the 4% rule isn't perfect.

Jaipur, India: 60 years

With a low annual cost of living of about $10,500, a $1 million would last about 60 years.

Assuming you need Rs 2 crore as retirement corpus after considering your living expenses, you should be able to meet the education goal with the current corpus and proposed SIP by eighth year, assuming 11% return. You might fall short of the 12-year goals by Rs 20-25 lakh, considering the same return.

A $1 million annuity could pay $6,073 a month or $72,876 a year for a 65-year-old woman purchasing an immediate single life annuity. Annuity providers calculate the monthly payout of a $1 million annuity based on factors such as the type of annuity and the annuitant's age and gender.

Once you have $1 million in assets, you can look seriously at living entirely off the returns of a portfolio. After all, the S&P 500 alone averages 10% returns per year. Setting aside taxes and down-year investment portfolio management, a $1 million index fund could provide $100,000 annually.

Employee Benefit Research Institute (EBRI) data estimates that just 3.2% of Americans have $1 million or more in their retirement accounts. Here's how much most Americans have saved and what you can do to boost your retirement savings. Don't miss out: Click to see our list of best high-yield savings accounts.

Is 3 crore enough to retire in India? ›

For a comfortable retirement, aim for a corpus of Rs 3.14 crore, requiring a monthly equity investment of Rs 31,000, or Rs 60,000 for a corpus of Rs 6 crore in 20 years. Maintain an 80:20 equity-debt mix in your post-retirement portfolio to balance risk.

Assuming life expectancy is 90 years, one needs a retirement corpus of Rs 5.1 crores to sustain the same lifestyle. There is a sizeable gap of Rs 3.5 crores between the retirement that we want and the one that we are preparing for.

Adhil Shetty, CEO of Bankbazaar.com, says, “Retiring with a corpus of over Rs 1 crore is achievable with early planning and disciplined investing. By leveraging the power of compounding, diversifying your portfolio, and periodically increasing your investments, you can build a substantial retirement fund.

There are estimated to be a little over 8 million households in the US with a net worth of $3 million or more.

According to estimates based on the Federal Reserve Survey of Consumer Finances, a mere 3.2% of retirees have over $1 million in their retirement accounts. The number of those with $2 million or more is even smaller, falling somewhere between this 3.2% and the 0.1% who have $5 million or more saved.

Home equity and moderate nest eggs facilitate occasional luxuries and social engagements. With a net worth of $1.9 million, retirees in this percentile are deemed well-off, enjoying a lifestyle enriched by extensive savings and investments. This includes bucket-list travels, charitable endeavors and legacy planning.

In other words, your retirement corpus should be at least 30 times your annual expenses of today. For example, if you are 50 years old and your monthly expenses are Rs 75,000 (or annually Rs 9 lakh), then as per the 30X rule, you need 30 times Rs 9 lakh to retire comfortably.

If we assume a life expectancy of up to 85, then you will have to plan for 33-35 years. We hope you have factored this into the ₹10 Cr corpus that you want to build for your retirement.

However, ₹20 crore retirement fund in 25 years is highly ambitious and hence, I would suggest 15 per cent annual step up. By using this one would be able to start with smallest possible monthly SIP amount to start the mutual fund journey of ₹20 crore retirement fund accumulation."

All jokes aside, yes, 10 crores is a massive amount of money. In dollar terms 1.5 million dollars. There are 36 million millionaires all over the world, mostly concentrated in North America and Europe, out of 7.7 billion people, which is less than 0.5% of the world population.