SWP Calculator

A Systematic Withdrawal Plan (SWP) is a facility that allows an investor to withdraw a fixed amount of money from their mutual fund scheme at regular intervals (e.g., monthly, quarterly, or annually). It provides a steady stream of income while the rest of the investment continues to have the potential for capital appreciation.

Key Benefits of SWP

• Regular Income: SWP is an excellent tool for retirees or anyone looking for a fixed cash flow. It helps create a predictable income stream from your investments to meet regular expenses.
• Capital Appreciation: While you withdraw a portion of your investment, the remaining amount stays invested and continues to benefit from market growth, potentially increasing your overall corpus over time.
• Tax Efficiency: Withdrawals from equity funds held for more than one year are taxed as long-term capital gains (LTCG). Gains up to ₹1 lakh in a financial year are tax-free, and gains above that are taxed at a concessional rate of 10%, making it more tax-efficient than interest from traditional instruments like Fixed Deposits.
• Flexibility: You have the flexibility to choose the withdrawal amount, frequency, and date. You can also stop the SWP or modify the instructions at any time.

Who is SWP Suitable For?

SWP is ideal for individuals who have accumulated a significant corpus and need a regular source of income, such as:

• Retirees: To create a pension-like income from their retirement savings.
• Individuals with regular financial goals: Such as paying for monthly expenses, EMIs, or funding a child's education.
• Conservative Investors: Who want to systematically book profits and reduce their exposure to market volatility over time.