Systematic Withdrawal Plan (SWP)
A facility to periodically withdraw money as needed at regular intervals.
Systematic Withdrawal Plan (SWP)
What is SWP?
A simple facility that allows you to periodically take out a fixed amount of money from your mutual fund investments in a systematic manner.
How does SWP work?
If you don’t want to worry about withdrawing all your mutual fund investments in one go, this facility is for you.
- Your investment in mutual fund schemes have grown over a period of time
- You don’t want to withdraw it in one go or want to create a steady income stream from it
- A fixed amount will get redeemed from your mutual fund investment every month or quarter and get credited to your bank account
- The balance amount will continue to stay invested and potentially grow
This way, you can create a steady income stream from your mutual fund investments while allowing it to grow.
Why is SWP good for you?
- You can create a steady income stream
- You can systematically withdraw your money based on your goals
- You can benefit from your investments by systematically withdrawing some money while letting the rest grow by staying invested
New to Investing!
Start your Investing Journey with Edelweiss Mutual Fund
You are aware and have invested in SIP (Systematic Investment Plan) as a vehicle to invest periodically in mutual funds. Since you have already initiated a process of saving for your retirement corpus, have your heard of a facility which allows you to withdraw your money systematically? This not just provides you with regular income with periodic withdrawals but also allows your remaining money to stay invested and earn market linked returns.
Checkout our Blogs related to SWP
What is SWP in Mutual Fund? Meaning, Working & Benefits of SWP Investment ?
You have made your investments in a mutual fund, but have you thought about how to withdraw funds when it comes time to reap the benefits of your investment? A Systematic Withdrawal Plan (SWP) is one of the ways to withdraw money from your mutual fund (MF) investment. With a SWP, you can withdraw a fixed or a variable amount periodically.
De-jargonising SIP, STP & SWP
When you start your investment journey with mutual funds you are already aware of the many benefits that mutual funds offer ranging from diversification and liquidity to access to expert fund managers. As a result, you only end up paying attention to the choice of investment and do not focus on the way you invest.
How to choose Best Mutual Funds for SIP to invest ?
Investing through the Systematic Investment Plan (SIP) route is a beneficial way of building a corpus for your future needs. In case of SIP, you invest a fixed amount periodically (every week, fortnight, month, etc.) over the long term in a fund of your choice. Whatever be your goals, you can achieve them through regular investments in a high-growth fund by following the discipline of regular investing without getting distracted by the noise in the markets. The regularity of investments is as important as the fund that you select for your investments
Checkout our videos related to SWP
Calculate the monthly withdrawals from your investments and the total value at the end of SWP
Frequently Asked Questions
You can choose to opt out from the SWP (Systematic Withdrawal Plan) at any point of time by submitting a written request to the nearest designated Investor Service Center. Such request for discontinuation should be received at least 10 working days prior to the next due date of the SWP.
Yes, it’s a good option as you continue to earn from your investments even as you withdraw your money to meet your income needs. In this you don’t need to worry about reinvesting your corpus during retirement years.
For SWP (Systematic Withdrawal Plan), one should opt for the scheme that is more stable and less volatile, since we are looking for a steady monthly income here. With that perspective, Edelweiss Balanced Advantage Fund and Edelweiss Equity Savings Fund are best suited for SWP.
Low interest rate have made investor worry about their future income needs. Hence, SWP is now becoming more ideal choice. SWP gives you flexibility to pre-decide the withdrawal amount and periodicity (i.e. Monthly or Quarterly) from your mutual fund investment in systematic manner. The balanced amount remains invested in the fund which can grow. Whereas, in fixed deposit, your money is locked in for the agreed period. Interest received on fixed deposit is fully taxable as per the income tax bracket of the investor. For SWP, since it is invested in equity scheme, the taxation is in terms of capital gains. One can also start an SWP in equity scheme after one year of the initial investment, to save on the short term capital gains tax. If the holding period of investment is more than 12 months, the gains less than Rs 100,000 are not taxed and hence it is tax efficient. SWP gives you dual benefit –regular income plus growth of remaining invested amount whereas FD gives you assured fixed interest rate on your FD savings only on the lumpsum withdrawal.
A Systematic Withdrawal Plan (SWP) helps you withdraw a fixed amount periodically from your mutual fund investment instead of withdrawing a lump sum at one go.
SWP period can last till the funds are available for withdrawal or as per the period mentioned by you, whichever is earlier.
Start your SWP or modify/cancel your existing SWP with the below process-
Offline Process
- Download the request form (editable) SWP Facility and cancellation form from here
- Fill in the form with supporting documents, if any
- Submit the duly filled in form to any of our or Kfintech's branches
Online Process
coming soon
Expected Turnaround Time
- Registration: T+5 days after receiving the duly filled in form at any of our or Kfintech’s branches.
- Cancelation: 10 business days form the date of receiving the duly filled in form at any of our or Kfintech’s branches.
MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS, READ ALL SCHEME RELATED DOCUMENTS CAREFULLY.
