Unlocking the Power of Systematic Withdrawal Plans: A Comprehensive Guide to SWP
This article provides an overview of the Systematic Withdrawal Plan (SWP) and how it works. SWP is a facility offered by mutual funds that allows investors to withdraw a fixed amount periodically from their mutual fund investments. It is suitable for retirees or individuals who require consistent cash flow without having to sell units manually. The key benefits of SWP include regular income, flexibility, and reduced need for manual selling. The article explains how SWP works by determining the amount and frequency of withdrawals and the source of funds for payments. It also compares SWP to the Systematic Investment Plan (SIP) and highlights the differences between the two strategies. The summary emphasizes that both SIP and SWP offer disciplined approaches to mutual fund investing but serve different financial needs.
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