Know Everything About SIP And SWP

What is a Systematic investment plan?

Systematic investment plan, also known as SIP Investment, allows you to invest a fixed amount in a scheme of your choosing, at regular intervals. If you invest for a longer time, it can help to create good corpus. This helps to increase the return by not putting all your money at the peak of the market. SIP allows you to make investing a routine. SIP allows you to deduct a specified amount from your savings account at a time that you choose. This money is then put into the mutual funds scheme you have chosen.

You can choose the frequency of your SIP, from daily to weekly or monthly. You can also choose the SIP amount and put in more money if the returns are satisfactory and you have sufficient funds to invest. SIP schemes for debt are less desirable because they are less risky and volatile.

The SWP plan allows you to withdraw money from your lump sum investment at regular intervals. You can decide the amount and when you want to withdraw it. For those who have retired and need a steady source of income, SWP can be a great option. This option is also available to those with a specific need, such as a fixed amount of money for their children’s education.

How do I withdraw money from mutual funds?

  • Directly through AMC

You can withdraw money from mutual fund funds through AMC portals. You can redeem any amount you need using your password and id. To withdraw the amount, you can also go to the AMC and complete the redemption form. Once the redemption process has been completed successfully, a NEFT or cheque will be sent. The funds are usually credited within three working days.

  • Offline

If the scheme was purchased through an agent, you will need to complete the mutual fund redemption form. The amount is credited to the investor’s account via NEFT, or a cheque.

  • Online Portals

AMC partner portals allow you to redeem the amount via loin id or password. In just a few clicks, one can withdraw the funds. Once your request has been confirmed and processed, the money is sent directly to the linked account associated with the portfolio of the investor.

  • Demat or Trading account

If investment is made via Demat or trading account, the redemption process will remain the same. The redemption request can be sent using an e-payout. The amount is sent to the Demat account’s bank account.

An investor should be careful when withdrawing funds. Some schemes may have an exit load that charges a fee on the asset value if the funds are not withdrawn within a year. You should also check what the minimum amount you can withdraw from schemes. Before you withdraw the money, make sure to read every document.