Have you heard about the scheme or plan named SWP? This blog will help you to know what exactly SWP is and also make you understand how to calculate SWP Plan in the calculator.
SWP or Systematic Withdrawal Plan provides investors with a consistent income stream and refunds any money left out in the scheme. In every month or quarter or year, withdrawal of fixed or variable amounts can be done on a predetermined period. You can opt to make over cash flows to eliminate either a fixed sum or the investment’s capital gains.
Suppose you invested 10,00,000 in an MF scheme with Rs.20 NAV and 50,000 units is allotted. If you started SWP Rs.6000 monthly.
The first month of SWP where NAV is Rs. 22 (6000/22) 272.728 units. The balance will be (50,000-272.728) 49,727.272. Similarly, in the second month, the same process continues until the SWP period ends. The balance of the unit decreases over time in the SWP Plan.
What is the purpose of an SWP Calculator?
The Calculator that tells you how much money you’ll get out of your mutual fund investments each month. After the withdrawal, it indicates the MF investment of the total value. The SWP plan may allow you to get a normal income at the time of retirement.
You will find a formula box at SWP Calculator where you need to enter the amount of the total investment, monthly withdrawals, the estimated yearly rate of return, and investment tenure. It estimates the value of the mutual fund investments in the future.
How to calculate SWP on Calculators Excel Formula?
It displays the regular cash flows based on a systematic withdrawal schedule. You must apply the following formula:
A = PMT ((1+r/n)^nt – 1) / (r/n))
A = Future Value
PMT = Payment amount
n = number of compounds in a period
t = duration of the money invested
How can I calculate tax on the SWP calculator:
- You must enter the entire amount invested in MF.
- Enter the monthly withdrawal from the MF programme.
- The projected rate of return must be filled in.
- After that, you enter the investment’s duration in years.
- The SWP Calculator will display the total withdrawal, total investment, total interest earned, and the investment’s final value.
HDFC balanced calculator SWP Calculator Advantages
- The monthly income from MF investments through the SWP can be computed using the SWP Calculator.
- You can use the SWP Calculator to compute the maturity amount for various withdrawal amounts.
- The calculator assists you in determining the most appropriate monthly withdrawals from your MF scheme.
- The SWP Calculator can help you estimate how much money you have leftover in your SWP to fund different financial instruments.
Best SWP Plans Calculator
- HDFC SWP Plan Calculator
- Step Up SWP Calculator
- ICICI Mutual Fund SWP Calculator
- Axis Mutual Fund SWP Calculator
- Kotak SWP Calculator
- SWP Calculator Aditya Birla
- SBI Bandhan SWP Calculator
- Groww SWP Calculator
- Advisorkhoj SWP Calculator
SIP and SWP Calculator
SIP enables investors to finance a set amount for predetermined periods, whereas SWP lets investors withdraw the amount at predefined periods.
Both are good on their own terms so it’s the investors’ decision whether they want to use the SIP or SWP.