SWP Calculator

Calculate how long your mutual fund corpus will last with regular monthly withdrawals.

Your SWP Details

Total Investment (₹)

Monthly Withdrawal (₹)

Expected Annual Return (%)

Withdrawal Period (Years)

What is SWP and How Does It Provide Regular Income?

A Systematic Withdrawal Plan (SWP) is the opposite of a SIP. While SIP helps you build wealth by investing regularly, SWP helps you generate a regular income from your accumulated wealth. It is a popular choice among retirees and individuals who have built a substantial mutual fund corpus and now want to withdraw a fixed amount every month to meet their living expenses. Our SWP Calculator helps you determine how long your corpus will last based on your withdrawal rate and expected returns.

In this guide, we will explore how SWP works, its benefits, and the factors you need to consider before starting an SWP.

How Does SWP Work?

Here is a step-by-step explanation of how SWP functions:

The key here is that the withdrawal is not a fixed "interest" payment. It is a redemption of your own units. The goal is that your remaining corpus grows enough to sustain the withdrawals over the long term.

Why is SWP Useful?

Understanding the SWP Calculation

The math behind SWP is a bit complex because the corpus is both growing (due to returns) and shrinking (due to withdrawals). The sustainability of your SWP depends on the balance between the two. Key factors include:

Our calculator does this complex math for you. Just input the corpus, withdrawal amount, and expected return, and it will tell you exactly how long your corpus will last.

Example of SWP Calculation

Scenario: You invest ₹10 lakh in a mutual fund with an expected return of 8%. You withdraw ₹10,000 every month.

In this case, your corpus will last for approximately 28 years before it is fully depleted. This shows the power of SWP: a ₹10 lakh corpus can provide a monthly income of ₹10,000 for nearly three decades.

Frequently Asked Questions (FAQs)

Q: Is SWP better than a Fixed Deposit?
A: It depends. SWP offers potentially higher returns and better tax efficiency. However, FDs offer guaranteed and fixed returns. For retirees who need stability, a mix of both might be suitable.

Q: Can I change my withdrawal amount later?
A: Yes, you can modify your SWP amount at any time. You can also stop or pause it entirely.

Q: What happens if my mutual fund performs poorly?
A: If the fund's returns are lower than expected, your corpus will deplete faster. This is the main risk of SWP. It is important to choose a fund that aligns with your risk profile.

Q: How is SWP taxed?
A: For equity funds, withdrawals within 1 year attract 15% STCG tax. Withdrawals after 1 year attract 10% LTCG tax on gains above ₹1 lakh. This makes SWP quite tax-efficient.

When Should You Use This Calculator?

Use this SWP calculator when you are planning your retirement or when you want to generate a regular income from your investments. It helps you determine a safe withdrawal rate and gives you a realistic idea of how long your money will last.

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