Which pot do you draw from first?
Living off your savings? Draw in the right order.
- The pot to use each year
- Less tax on what you take out
- How much longer your money lasts
The best order leaves you
more after 25 years than drawing evenly · Tax-smart order
- Lasts
- All 25 yrs
- best order
- Left at the end
- ₹1.74 Cr
- after tax
- Tax over the years
- ₹41.81 L
Orders compared, by money left
- Tax-smart orderLeaves most₹1.74 Cr
Tax ₹41.81 L · lasts
- Evenly from every pot₹74.65 L
Tax ₹35.48 L · lasts
- Debt funds first₹89.36 L
Tax ₹37.62 L · lasts
- Equity first₹0
Tax ₹27.28 L · runs out 2050
- PPF/EPF first₹1.69 Cr
Tax ₹43.44 L · lasts
Left at the end, after the tax on cashing it all in.
Your inputs
Your spending
₹
₹1 L₹2 Cr
%
0%12%
5 yrs40 yrs
Income
₹
₹0₹1 Cr
Tax regime
Equity funds
₹
₹0₹5 Cr
₹
₹0₹5 Cr
%
0%18%
Debt funds
₹
₹0₹5 Cr
₹
₹0₹5 Cr
%
0%12%
PPF / EPF
₹
₹0₹5 Cr
%
0%10%
Keep your inputs as a file; it never leaves your device.
What this means
- ₹11.25 L of equity gains booked tax-free along the way.
Why?
Selling and buying back resets the cost, so less is taxed when you finally spend it.
More details
Where each year's money comes from
- Pension
- Debt funds
- Equity funds
- PPF/EPF
Money left, year by year
Why this order works
- Harvest ₹1.25 L of equity gains: every year: sell, buy back, no tax
- Debt gains inside the slab room: no tax while slab income stays under ₹12 L
- PPF/EPF next: tax-free now and later
- Equity last: the best grower compounds longest
How it's calculated
- Each year: spending rises with inflation, is drawn at the start of the year, and what's left grows at each pot's return.
- Tax: equity gains 12.5% above ₹1.25 lakh; debt-fund gains and pension at slab rates (with the standard deduction on pension); PPF/EPF tax-free. The rebate limit counts equity gains too.
- Gains: each withdrawal carries the pot's average share of gain.
- Tax-smart order: harvest equity gains that add no tax, spend debt inside the tax-free slab room, then PPF/EPF, then debt, then equity.
- Best order: the one that lasts longest, then leaves the most after the tax on cashing in.
Surcharge, senior-citizen slabs and FD interest taxed yearly aren't covered.
Tax figures follow Budget 2025 rules, for FY 2025-26 onward.
Common questions
Which should I withdraw from first in retirement?
Usually: use each year's tax-free room first (up to ₹1.25 lakh of equity gains, and slab income the rebate covers), then PPF/EPF, then debt funds, and leave equity to grow longest. Your mix of savings decides the exact order; this calculator compares them.
Is money taken out of PPF or EPF taxed?
No. PPF withdrawals and EPF withdrawals after five years of continuous service are tax-free, whenever you take them.
How are debt mutual funds taxed now?
Gains on debt funds bought from April 2023 are added to your income and taxed at slab rates, however long you held them.
Can I avoid tax on equity withdrawals?
Up to ₹1.25 lakh of long-term gains a year is tax-free. Only the gain part of a withdrawal counts, so you can take out more than ₹1.25 lakh without tax.