Why add both step-up and inflation?
A step-up raises your withdrawal in rupees; inflation reduces what each rupee buys. If your step-up equals inflation, your income stays flat in today’s money. If it is lower, your real income falls each year. The SWP calculator with step up shows both numbers side by side: the last withdrawal in rupees and the same withdrawal in today’s money.
Example
₹40 lakh invested at 8%, withdrawing ₹20,000 a month for 20 years with a 5% step-up and 6% inflation. The withdrawal grows to about ₹50,500 a month by year 20, but in today’s money that is only about ₹17,000 — because inflation ran slightly faster than the step-up. Enter these numbers above to see the full year-by-year table.
Step-up vs inflation: three cases
- Step-up = inflation: constant buying power, the corpus is used fastest.
- Step-up below inflation: the corpus lasts longer, but your lifestyle slowly shrinks.
- No step-up: the longest-lasting option, but after 20 years at 6% inflation the same rupee income buys only about 31% of what it bought at the start.
Plan for rising costs that grow faster
Healthcare and education costs in India often rise faster than general inflation. If a large part of your withdrawals goes to medical bills or fees, test an inflation rate of 7–8% in the calculator to see how much buffer you need.