remaining 5.5 crores I keep it as my corpus for the next year. The next year I do the same calculation, taking out 2 per cent and reinvesting the rest. Now we get to the business of actually calculating our corpus figure. Divide your annual estimated expenses (from point 1) by your real rate of return (from point 3) and you will get your corpus figure. Example: If my estimated real rate of return is 2 per cent and I expect my yearly retirement expenses to be 10 lakhs, the corpus I need to accumulate before I can retire is 10 lakhs divided by 2 per cent, which gives me 5 crores.
