Regardless of whether you work for a company or run your own business, making wise and appropriate investments ensures a secure future. The majority of individuals utilize mutual funds, postal services, and stock exchanges for optimal investment strategies. Each possesses its own advantages and disadvantages. With that considered, you ought to contemplate investing. We frequently come across SIP, a well-known investment method, but have you ever heard of SWP?
SWP, or Systematic Withdrawal Plan, is an intelligent investment strategy that allows investors to take out money periodically from mutual funds. In this, you take out a set amount from your account each month. In this section, we will explore how SWP surpasses SIP. We will also explore SWP.
What distinguishes SWP from SIP?
To learn about SWP, you first need to grasp SIP too. In a systematic investment plan, you contribute a set sum over an extended duration, allowing you to build up a considerable sum with interest. To initiate a SWP, you require a SIP that has been built up over an extended period. A video has recently gone viral on social media, showing that an investor can accumulate up to Rs 7 crore after investing in a SIP of Rs 25000 for 20 years and initiating an SWP. Let’s attempt to comprehend this computation.
How is the computation done?
You can utilize SWP to take out a specific sum from your mutual fund investment. This is a prolonged process, thus it mainly suits retirees. In this case, if you wish to ensure your financial future, then you might consider it. It functions similarly to a stable income for those who have retired. Let’s attempt to grasp it. Imagine investing Rs 25,000 monthly in an equity fund SIP for a duration of 20 years. On which you receive an annual interest of approximately 12%. Thus, upon reaching 20 years, your net worth amounts to Rs 2 crore.
You can now initiate a SWP on this corpus and execute it for the upcoming 20 years. If you take out Rs 1,50,000 each month, you will have withdrawn Rs 3.6 crore over 20 years. In addition to this, even after reaching 40 years, you will still possess around 7 crore rupees.
Related Posts
Sweta Mitra
Working in the media for last 7 years. The journey started in the year 2018. For the past few years, my working experience has been in Bengali media. Currently working at Timesbull.com. Here I write like Business, National, and Utility News. My favorite hobbies are listening to music, traveling, food,...
Related Stories
Business
Business
Business
Business
Business
Business
Business
Business
Business
Business