A Systematic Withdrawal Plan (SWP) is a facility that allows an investor to withdraw money from an existing mutual fund at predetermined intervals.
SWP helps investors to create a regular flow of income from their investments. Existing investors looking for income at periodical intervals usually use SWP to fund expenses during retirement.
Systematic Withdrawal Plans is of advantage to investors who require liquidity as it allows investors to access their money exactly when they need it. This makes it easier for the investors to carry out their financial plans and meet their goals.
Investors can regularly withdraw money from their existing investments through SWP. It facilitates the conversion of your investment into real cash flow.
SWP is possibly a good facility for your retirement as it helps you to redeem regular cash flow from your existing investment.
While SWP withdraws fixed amount regularly from your existing investment, your remaining amount remains invested and gives you a chance to seek better return.