1. In a SWP, if you withdraw an amount of 10% every year from your mutual fund (growth option) for meeting your retirement expenses, its units (or corpus) will reduce to zero in 10 years only if its CAGR is 0-1%.
2. However, if its CAGR is more than 1%, its units (or corpus) will not become zero in 10 years.
3. For example, if its CAGR is 5%, 6%, 7%, 8%, 9%, 10% and 11%, then its units (or corpus) will become zero only after 13, 14, 15, 17, 20, 25 and 45 years.
4. In fact, if your mutual fund's CAGR is 11.2% and above during your retirement years, your units (corpus) will actually multiply exponentially and perpetually, without ever becoming zero, even while you continue withdrawing an amount of 10% every year.
5. For example, if its CAGR is 11.2%, 12%, 13%, 14% and 15%, then your corpus will multiply 2, 20, 60, 130 and 250 times during 50 years of your retirement - due to the power of compounding in the growth option of your mutual fund - which enables you to leave an even heftier wealth than your original corpus as a bequeathal for your near and dear ones.
2. However, if its CAGR is more than 1%, its units (or corpus) will not become zero in 10 years.
3. For example, if its CAGR is 5%, 6%, 7%, 8%, 9%, 10% and 11%, then its units (or corpus) will become zero only after 13, 14, 15, 17, 20, 25 and 45 years.
4. In fact, if your mutual fund's CAGR is 11.2% and above during your retirement years, your units (corpus) will actually multiply exponentially and perpetually, without ever becoming zero, even while you continue withdrawing an amount of 10% every year.
5. For example, if its CAGR is 11.2%, 12%, 13%, 14% and 15%, then your corpus will multiply 2, 20, 60, 130 and 250 times during 50 years of your retirement - due to the power of compounding in the growth option of your mutual fund - which enables you to leave an even heftier wealth than your original corpus as a bequeathal for your near and dear ones.