Will Your Retirement Corpus Last? Why a Probability Beats One Number

Will your retirement corpus last? The only honest answer is a probability: test your plan against many possible futures and count how often the money survives. A plan that lasts to 85 on a straight-line calculator can fail in a large share of real market sequences with exactly the same average return. That gap, between working on paper and working in the market, is what this page is about.

Most retirement calculators grow your money at one fixed rate. That is like planning a road trip on the average speed of the journey and ignoring the traffic. You will usually arrive. Sometimes you will not, and the plan never told you how often.

The same plan, two answers

Take ₹1 crore at 60, withdrawing ₹42,000 a month and raising it 6% every year for inflation, with the money earning an 8% average. Here is what a straight-line calculator says, next to what 1,000 futures with real market swings say.

Nothing about the plan changed between the two boxes. The average return is identical. The only difference is that the right-hand box lets the years arrive in different orders, the way they actually do.

How the 1,000 futures are built

The method is called a Monte Carlo simulation, after the casino: it repeats a random draw many times and looks at the spread of results. In nyvo's retirement calculator, each future is built like this:

1. Real months, shuffled in blocks. Twelve-month stretches are drawn at random from the month-by-month record of Indian fund category averages since February 2013, treating the record as a loop so every month is drawn equally often, and good and bad years arrive in an order nobody chose.
2. Re-centred on your assumption. Each stretch is shifted so the compound yearly average, the CAGR, matches the return you set. The swings are history's; the average is yours.
3. Your plan, run through it. Savings go in while you work; spending comes out once you stop, rising with inflation.
4. Count the survivors. A future fails in the month the money runs out. The probability is the share that reach your chosen age with money left.

The band in that chart is the thing a straight-line calculator hides. It shows where 8 in 10 futures land. A single line through the middle is the most likely path, and still only one of a thousand.

Why the order of returns matters so much

While you are saving, a bad year early on is almost good news: your monthly investment buys more units cheaply. Once you are withdrawing, it flips. A fall in the first years forces you to sell more units to fund the same spending, and those units are gone before the recovery arrives. The same fall fifteen years into retirement does far less damage, because by then the corpus has already done most of its work.

That is why two retirements with the same average return can end so differently, and why we gave the opening years a page of their own.

How to read your probability

• It is a measure of risk, not a forecast. 80% does not mean you will be fine; it means the plan failed in 1 future in 5.
• Look at the bad case, not just the headline. The age at which the worst 1 in 10 futures runs out tells you how bad "unlucky" is.
• Compare plans, not percentages. The most useful thing a probability does is show you how much one change buys: retiring two years later, spending ₹5,000 a month less, or investing a little more now.
• Recheck it. Markets move, plans change. A probability from five years ago is about a different plan.

Related nyvo guides

• Is ₹1 Crore Enough to Retire in India? – the odds for one corpus, by age and spending.
• The First Five Years of Retirement Decide the Rest – the sequence problem in detail.
• Turning a Retirement Corpus into Monthly Income – ways to draw the money down.

A straight line answers the question "how much will I have?". Retirement asks a different one: "how often does this plan fail?". Only the second answer lets you do something about it before it happens.