India Top 10 SWP Mutual Funds for 2024
You have probably heard of the Systematic Investment Plan which is the plan to do a disciplined investment monthly it's an easy option to invest in mutual funds, but have you ever heard that if you invest a large amount and withdraw it systematically that's where the systematic withdrawal plan comes in. The SWP is one of the popular sources to generate regular income. It's like you have a chance to generate passive income which means you don't have to work and make money every month. In this blog post, we will gain all the knowledge about SWP and its best-performing SWP mutual fund in India. let's move with the basics.
What is a Systematic Withdrawal Plan?
A Systematic Withdrawal Plan allows you to invest a large amount upfront and with a systematic strategy and withdraw your regular generated income. The Best SWP Plans in India provide liquidity to investors, which allows them to access their Mutual Funds when needed, and makes it a suitable option for those who require regular cash flow. In SWP you will also get the benefit of compound interest.
When you start your SWP you can withdraw your money from the next month of investment because it doesn't have any lock-in period. so you don't have to wait for 5 to 10 years like a life insurance policy. One more benefit it serves you which is you can decide the date of withdraw your amount.
How Does a Systematic Withdrawal Plan Work?
To help you with easy understanding, allow me to provide an example:
Suppose you invest Rs.1,00,000 into a mutual fund with a Net asset value (NAV) of Rs.20 per unit. You invested 5,000 units. Every month, you choose to withdraw Rs. 5,000 amount by using SWP.
Here is how SWP works:
So, your selected mutual fund will credit Rs. 5,000 from your bank account and also redeem 250 units which is about (Rs. 5,000 ÷ Rs. 20) in the first month.
The redemption of fewer units around 227 units will bring you the same Rs. 5,000. If the NAV increases to Rs.22 in the second month.
| Month | Withdrawal Amount | NAV | Unit Redeemed | Remaining Units |
|---|---|---|---|---|
| Month 1 | 5,000 | 20 | 250 units | 4,750 units |
| Month 2 | 5,000 | 22 | 227.273 units | 4,522.727 units |
| Month 3 | 5,000 | 21 | 238.10 units | 4,284.627 units |
| Month 4 | 5,000 | 23 | 217.392 units | 4,067.235 units |
| Month 5 | 5,000 | 24 | 208.335 units | 3,858.90 units |
| Month 6 | 5,000 | 25 | 200 units | 3,658.90 units |
When the NAV increases, you’ll need to sell fewer units to get Rs.5000. If the NAV decreases, you’ll have to sell more units to withdraw the same amount. This will keep going until your investment is finished or you decide to stop the withdrawals.
Which is the Best SWP Mutual Fund in India 2024?
| Fund Name | Launch Date | AUM (Crore) | CAGR |
|---|---|---|---|
| ICICI Prudential Equity and Debt Fund | 05-11-1999 | 40,083.8 | 15.75% |
| SBI Contra Fund | 14-07-1999 | 39,384.74 | 17.9% |
| Nippon India Large Cap Fund | 08-08-2007 | 32,846.36 | 13.64% |
| ICICI Prudential Large and Mid Cap Fund | 09-07-1998 | 16,572.31 | 19.16% |
| Parag Parikh Flexi Cap Fund | 05-05-2013 | 78,489.75 | 20.3% |
| HDFC Hybrid Debt Fund | 01-01-2013 | 3,347.11 | 10.34% |
| ICICI Prudential Regular Savings Fund | 10-03-2004 | 3,380.37 | 10.1% |
| SBI Equity Hybrid Fund | 01-12-1995 | 73,419.36 | 14.28% |
| HDFC Balance Advantage Fund | 01-02-1994 | 95,340.98 | 18.62% |
| ICICI Prudential Multi Asset Allocation Fund | 31-10-2002 | 48,167.25 | 21.58% |
Top Hybrid SWP Mutual Fund
1. ICICI Prudential Equity & Debt Fund
One hybrid investing choice is the ICICI Prudential Equity & Debt Fund. On 05.11.9999, this fund was introduced. With its outstanding performance metrics, you would have made a profit of Rs. 5,22,504 if you had invested Rs. 10,000 over the past three years. This is an annualised SIP return of 27.51%, which beat the benchmark of 21.31%. This ICICI Equity & debt fund is designed for all new investors with the experienced ones.
2. HDFC Hybrid Debt Fund
Introduced to the investors on January 1, 2013, the HDFC Hybrid Debt fund is a combination of debt and equity. It has outperformed its peers with a benchmark index of 8.29%, which means that if you had invested Rs.5000 throughout the past three years, you are going to earn a profit of Rs.2,16,781, with a SIP annualised return of 13.15%. It is less risky than pure equities funds and an excellent choice for investors who wish to diversify their portfolios.
3. ICICI Prudential Regular Savings Fund
March 10, 2004, marked the market release of the ICICI Prudential Regular Savings Fund. The goal of this hybrid fund is to increase capital while using its debt funds to offer some level of stability. At an annualised SIP return of 12.18% over the last three years, if you had invested Rs.3000, you would have gained a corpus of Rs.1,28,355, truly outperforming the benchmark of 8.29%. It’s a great investment option for retirees or their children's education, this fund is a real fit for your portfolio.
4. SBI Equity Hybrid Fund
In the SBI Equity Hybrid Fund if you have invested Rs. 10000 over the past 5 years then you will build a great earning of Rs.8,98,721, with an annualised SIP return of 16.68% This fund is worth it for investors who want both long-term wealth growth and a small amount of safety from market volatility.
5. HDFC Balanced Advantage Fund
Bonds and equities are invested dynamically by the HDFC Balanced Advantage Fund mutual fund. With a benchmark index outperformance of 20.32%, the fund's SIP annualised return for the last five years is 25.94%. One would gain a large sum of Rs. 11,17,768. If they had invested Rs. 10,000, a great solution for anyone searching for a more flexible investing that changes with the market.
6. ICICI Prudential Multi Asset Allocation Fund
A popular hybrid fund, the ICICI Prudential Multi Asset Allocation has outperformed its benchmark index by 20.32% over the last five years, with an impressive annualised SIP return of 25.28%. Let's say that to build up a corpus of Rs.11,00,035 over the past five years, you had to invest Rs. 10,000, per month. The investors wanting to get the safety that comes with having several kinds of assets as well as long financial growth, it may be the right choice.
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SWP Best Equity Mutual Fund list
1. SBI Contra Fund
The SBI Contra fund buys equities with the expectation of strong future returns. An annualised SIP of 33.94% will enable you to surpass the benchmark index of 26.13% if you have invested 10,000 over the last three years, generating an impressive corpus of Rs.5,68,746. Those investors who can invest at least for 5 to 7 years and also have a greater capacity for risk could look into this fund.
2. Nippon India Large Cap Fund
In the last three years, if you invested Rs. 5000 in Nippon India Large Cap Fund, then your current value would be worth Rs. 2,65,817, with an annualised SIP return of 28.54%, which beat its benchmark index of 22.73%. When looking to profit from the potential growth of businesses in various kinds of industries, it might be a smart choice who want to play safe.
3. ICICI Prudential Large and Mid Cap
A mix of growth potential and stability is offered by the ICICI Prudential Large and Mid Cap. Also shown amazing performance with 30.49% annualised SIP return. which outperforms its benchmark of 27.64% and the Earnings of Rs.3,72,533 would be yours if you had invested Rs.3000 in a SIP. Those who are working towards life objectives like retirement or home ownership could find this fund amazing because of its balanced approach to stock investment.
4. Parag Parikh Flexi Cap Fund
A Parag Parikh Flexi Cap fund has a long history that builds its era for the long term. This Equity Mutual Funds has a 3-year SIP investment of Rs. 5000, you would therefore have a large amount of Rs. 2,61,750. Since this fund benefits from both established industry leaders and emerging companies, it can be an excellent option for investors who want experience in a broad range of businesses.
Is a Systematic Withdrawal Plan Suited for You?
Let’s see if this plan is worth your investment portfolio or not:
1. Retirees: You should be retired or about to retire, an SWP could be ideal for you, because you might save a significant amount of money over the years. By investing that lump sum and receiving a regular, predictable income each month, similar to paying a cheque, you can avoid letting it sit around. This maintains the growth potential of your remaining investment while helping to pay for your daily necessities. It’s a safe investment option in India smart choice that will allow you to enjoy your retirement without any worry.
2. Who Wants Passive Income: Do you wish to make money without worrying about your mutual fund investment. It is simple to use SWPs. You won't need to make decisions often once you've invested and can relax and enjoy a consistent income stream. Getting paid every month without having to work is similar to that. An SWP offers a straightforward and efficient way to increase your income without the headache of ongoing upkeep in the Indian mutual fund market.
3. Long Term Investors: An SWP offers a perfect balance for investors who want to see their money grow but also need regular access to cash. Half of your investment can be withdrawn for immediate needs, while the other half will keep making money. Long-term investors who require an ongoing source of income to cover everyday expenses and want their money to work for them will find it perfect. You are able to achieve stability and growth at the same time.
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