Did you know that mutual funds offer the facility of systematic withdrawal plan? Are you aware of the systematic withdrawal plan?
As the name suggests, a systematic withdrawal plan allows investors to redeem their investment from their mutual fund scheme in a systematic way. Instead of withdrawing a lump sum amount, an investor can withdraw money through fixed or variable instalments.
These withdrawals could be done on a monthly, quarterly, half-yearly, or annually basis depending on the investor’s financial requirements. A systematic withdrawal plan provides investors with a regular cash flow from their investments in any mutual fund schemes.
The Systematic Withdrawal Plan (SWP) works exactly opposite of the Systematic Investment Plan (SIP). Under SIP, investors can accumulate their savings, whereas in SWP, they can redeem their investments periodically at the prevailing net asset value.
Investors can choose to either withdraw the capital gains on their mutual fund investments or a fixed amount. The withdrawal amount can be used to re-invest in some other schemes or can be retained by investors in the form of cash.
SWP works best when investors have financial goals like children’s education and marriage, retirement planning, and more. However, investors can also utilize SWP benefits for various other pay-out requirements.
Mutual fund investments are subject to market risks. Please read the scheme information and other related documents carefully before investing.
Risk Factors – Investments in Mutual Funds are subject to Market Risks. Read all scheme related documents carefully before investing. Mutual Fund Schemes do not assure or guarantee any returns. Past performances of any Mutual Fund Scheme may or may not be sustained in future. There is no guarantee that the investment objective of any suggested scheme shall be achieved. All existing and prospective investors are advised to check and evaluate the Exit loads and other cost structure (TER) applicable at the time of making the investment before finalizing on any investment decision for Mutual Funds schemes. We deal in Regular Plans only for Mutual Fund Schemes and earn a Trailing Commission on client investments. Disclosure For Commission earnings is made to clients at the time of investments. Option of Direct Plan for every Mutual Fund Scheme is available to investors offering advantage of lower expense ratio. We are not entitled to earn any commission on Direct plans. Hence we do not deal in Direct Plans. SID/SAI/KIM | Code Of Conduct
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