Let's say I have 1 cr in my bank at the age of retirement which grows at 8% per year. My monthly expense at that time is 50000 which increase annually by 7% due to inflation.. how long will my funds last. Show a detailed table wise calculation.. also provide a formula in Google sheets where I input the above values and I get the answer to how long my funds will last

To determine how long your funds will last, we'll calculate the balance each year by considering the annual growth of your funds and the annual increase in your expenses due to inflation. We'll set this up in a table and provide a Google Sheets formula for easy calculation.

### **Step-by-Step Calculation:**

1. **Initial Conditions:**
   - Initial funds: ₹1 crore = ₹1,00,00,000
   - Annual growth rate of funds: 8%
   - Initial monthly expense: ₹50,000
   - Annual inflation rate for expenses: 7%

2. **Annual Calculations:**
   - **Year 1:**
     - Annual expense = ₹50,000 × 12 = ₹6,00,000
     - Annual growth on funds = 8% of ₹1,00,00,000 = ₹8,00,000
     - End of Year 1 funds = Initial funds + Growth - Expense
       \[
       = ₹1,00,00,000 + ₹8,00,000 - ₹6,00,000 = ₹1,02,00,000
       \]
   - **Year 2:**
     - New monthly expense = ₹50,000 × (1 + 7%) = ₹53,500
     - Annual expense = ₹53,500 × 12 = ₹6,42,000
     - Annual growth on funds = 8% of ₹1,02,00,000 = ₹8,16,000
     - End of Year 2 funds = ₹1,02,00,000 + ₹8,16,000 - ₹6,42,000 = ₹1,03,74,000

3. **Continue until the funds deplete.**

### **Detailed Table (Example for first 5 years):**

| Year | Starting Balance (₹) | Annual Growth @ 8% (₹) | Annual Expense (₹) | End Balance (₹) |
|------|----------------------|-----------------------|--------------------|-----------------|
| 1    | 1,00,00,000           | 8,00,000              | 6,00,000           | 1,02,00,000      |
| 2    | 1,02,00,000           | 8,16,000              | 6,42,000           | 1,03,74,000      |
| 3    | 1,03,74,000           | 8,29,920              | 6,86,940           | 1,05,16,980      |
| 4    | 1,05,16,980           | 8,41,358              | 7,35,026           | 1,06,23,312      |
| 5    | 1,06,23,312           | 8,49,865              | 7,86,478           | 1,06,86,699      |

The calculations can continue year by year until the funds deplete.

### **Google Sheets Formula:**

1. **Setup Your Google Sheet:**
   - **A1:** `Starting Funds`
   - **B1:** `₹1,00,00,000`
   - **A2:** `Annual Growth Rate`
   - **B2:** `8%`
   - **A3:** `Initial Monthly Expense`
   - **B3:** `₹50,000`
   - **A4:** `Annual Inflation Rate`
   - **B4:** `7%`

2. **Formula to Calculate the End Balance Each Year:**

   - **Starting Balance for Year 1 (C1):** `=B1`
   - **Annual Expense for Year 1 (D1):** `=B3*12`
   - **Annual Growth (E1):** `=C1*$B$2`
   - **End Balance for Year 1 (F1):** `=C1 + E1 - D1`

   - **Starting Balance for Year 2 (C2):** `=F1`
   - **Annual Expense for Year 2 (D2):** `=D1*(1+$B$4)`
   - **Annual Growth (E2):** `=C2*$B$2`
   - **End Balance for Year 2 (F2):** `=C2 + E2 - D2`

   Drag these formulas down for each subsequent year until the balance becomes zero or negative.

### **Google Sheets Function:**
To directly calculate how many years the funds will last:

```excel
=IF(A1 > 0, IF(A1*(1+B2)-B3*12 > 0, 1 + YOUR_CALCULATION_FOR_NEXT_YEAR, "Funds Depleted"), "Funds Depleted")
```

You'll need to iterate this to count how many times the calculation remains positive until the balance depletes.

### **Questions for Further Exploration:**

1. How would changes in inflation rate affect the duration of the funds?
2. What if the growth rate of the funds was variable rather than fixed at 8%?
3. How does starting with a different amount of savings impact the longevity of funds?
4. What would be the impact of a one-time large expense on the fund's longevity?
5. How can additional income streams in retirement influence the longevity of your funds?

### **Tip:**  
Always re-evaluate your financial plan annually to adjust for any changes in expenses or investment returns, ensuring your funds last as long as possible.

Learn how to calculate how long your retirement funds will last with compound interest at 8% annually and expenses increasing by 7% annually due to inflation. Detailed table-wise calculation and a Google Sheets formula provided.

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