A Systematic Withdrawal Plan (SWP) is an intelligent way to withdraw money at regular intervals from large investments while you allow them to continue to grow with the market. With a SWP, you can predetermine an amount to be withdrawn monthly with minimum damage to your invested corpus.
Let's understand SWP with an example:
Jaya is a business owner. To date, she has invested regularly and collected a corpus of Rs. 30 lakhs, with an aim to secure herself during her retirement period and maintain the same lifestyle with regular cash withdrawals. In this case, she opted for a SWP by investing the corpus via a lumpsum transaction in a single mutual fund (with a low-to-medium risk and projected annual growth rate of approx +10%), and setting up a SWP in that fund for the 1st of each month for Rs. 30,000 per month.
At the end of the first year, her corpus is down by only Rs. 76,216 while her total withdrawals add up to Rs. 3,60,000.
Over the next 15 years, she can continue the same withdrawals. While the invested money will keep growing, she will comfortably be able to sustain herself with the monthly withdrawals. Thus through a SWP, she continues to benefit from the growth in her corpus and regular monthly withdrawals. Our online SWP calculator
helped Jaya make the right decisions for her retirement.
What is a Systematic Transfer Plan or STP?
A Systematic Transfer Plan (or STP) allows you to move your investments from one fund to another fund from the same AMC just like a SIP investment, with a set date, amount and number of installments. This method of investing is used very often to ...
What is Insta Redemption? How do I avail this facility?
Mutual Fund withdrawals typically take up to 2-3 working days to credit the amount back to your bank account. Insta-redemption is a facility by which you can withdraw upto Rs. 50,000 or 90% of your invested balance (whichever is lower), within 30 ...
Can I invest with a HUF account?
Yes, you can create a HUF account with Glide Invest. However, the setup needs to be done manually through our customer support team. Once the account is setup, then all transactions can be done through the app just like a normal user. By forming a ...
Can I create an account for a minor?
Yes, you can create an account for a Minor with Glide Invest. However, the setup needs to be done manually through our customer support team. Once the account is setup, all transactions can be done through the app just like a normal user. Step-1: ...
How can I find out if I have invested in a regular plan or direct plan?
Investments made through a financial intermediary like a bank or a broker are usually regular plans. If you have invested through a financial planner and he/she has advised you on what to buy, done all the paperwork himself/herself and has collected ...