Can I run an SIP and an SWP at the same time in the same mutual fund?

Yes. But first, you need to build a large corpus that can support your withdrawals while you continue to make fresh investments in that compound. This dual strategy works well when you want to continue to build wealth but also need a steady stream of income every month.

What happens to my SWP during volatile markets?

The amount you withdraw remains the same during volatile markets. However, you may have to redeem a higher number of units. That’s why it’s safer to set up an SWP from stable funds like debt or hybrid funds.

Can I modify or stop an SIP or SWP anytime?

Yes. Both these schemes offer the flexibility you need. Therefore, you can increase, decrease, pause, or stop them as your financial situation evolves with time.

Is SWP suitable even if I’m not retired?

Yes. The goal of setting up an SWP is to generate recurring income. So, you can use an SWP to fund predictable expenses like rent, school fees, or EMIs.

How do I decide the best withdrawal amount for my SWP?

For a starting point, consider 3% to 6% of the annual withdrawal value. It depends on the type of fund and your risk tolerance. However, if you withdraw at a higher rate, it may deplete your corpus faster.

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SIP vs SWP

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Mutual Funds

SIP vs SWP

Mutual Funds

SIP vs SWP

SIP and SWP both strategies are crucial to financial planning. In reality, both can work hand-in-hand, helping you balance your growth and income. In this blog, we have explained how you can combine both these strategies based on your financial goals.