What is SWP Calculator (Systematic Withdrawal Plan)| How to Use SWP Calculator 

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You must have heard about SIP calculators and lump sum calculators for mutual fund investments. Did you know there is also a calculator for systematic withdrawal plans in mutual funds? It’s called the SWP calculator.

If you are new to the stock market, you must know what a systematic withdrawal plan is.

An SWP, or Systematic Withdrawal Plan, is a mutual fund option that lets you withdraw a fixed amount regularly, providing a steady income stream. 

It’s like a reverse SIP; instead of investing, you systematically withdraw money.

Let’s understand everything: how a systematic withdrawal plan works and how the SWP calculator helps you choose the right SWP scheme.

Here we begin!

What is a Systematic Withdrawal Plan in Mutual Funds (SWP)?

SWP stands for Systematic Withdrawal Plan. It’s a method in which you can take out money regularly from your mutual fund investments. Instead of withdrawing a big amount all at once, you set up a plan to take out smaller amounts over time.

Now, enjoy lifetime zero brokerage on all segments: mutual funds, stocks, bonds, currency, and more!

It’s like getting a monthly allowance from your investments rather than cashing out everything at once.

Now, what exactly is a systematic withdrawal plan?

It’s like the opposite of an SIP.

An SIP – Systematic Investment Plan lets you invest a fixed amount of money into a mutual fund at regular intervals.

An SWP allows you to withdraw a set amount of money from your mutual fund investment at regular intervals.

Now, in the process of doing a systematic withdrawal plan in mutual funds, what is the role of the SWP Calculator?

Let us understand with an example of a systematic withdrawal plan!

An SWP calculator is like a smart planner.

It helps you decide how much money you can safely withdraw from your investment without using it all up too quickly. 

With an SWP investment, your money remains where you put it, and the SWP calculator guides you on how to manage it wisely.

What is SWP Calculator?

An SWP Calculator helps you see how much money you can withdraw from your mutual fund investments each month. It shows you the total value of your investment after each withdrawal. This tool is useful if you want a steady income during retirement.

How Systematic Withdrawal Plan Works?

Here’s how a systematic withdrawal plan in mutual funds works:

  1. Investment: You invest a lump sum amount in a mutual fund.
  2. Regular Withdrawals: You set up an SWP to withdraw a specific amount of money, say ₹10,000, every month.
  3. Fund Balance: The remaining money stays invested in the mutual fund and continues to grow.

Example of Systematic Withdrawal Plan

Suppose you invest ₹10,00,000 in a mutual fund offering an SWP. You opt to withdraw ₹10,000 every month. The mutual fund will redeem units equivalent to ₹10,000 from your investment every month and credit it to your bank account.

The remaining amount continues to be invested. You will continue earning returns on the balance invested amount.

An SWP allows you to withdraw a specified amount of money on a monthly, quarterly, semi-annually, or annual basis. Thus providing you with a steady income stream, especially useful for retirement planning.

Explore the pros and cons of a systematic withdrawal plan in mutual funds!

How to Invest in Systematic Withdrawal Plan

To invest in an SWP, you first need to have some money in a mutual fund or similar investment. Then, you decide how much money you want to take out and how often.

You can set this up with the online trading platform. Once done, they’ll start transferring the money to your account on the schedule you’ve chosen.

Now, in all of this, what is the role of the SWP Calculator?

Role and Benefits of SWP Calculator

Using an SWP calculator offers several benefits for mutual fund investors:

  • Simplifies Complex Calculations: The calculator helps investors easily figure out their monthly withdrawals and the final value of their investments.

Thus avoiding the need for complex math.

  • Compare SWP plans in mutual funds: You can use the SWP calculator easily to check the returns on different withdrawal amounts and calculate the maturity amount. 

Choose the one that suits your financial necessities!

  • Regular Income Stream: Useful for retirees or anyone needing a fixed income, as it shows how much can be withdrawn regularly without depleting the capital.
  • Financial Planning: You can plan your finances better by knowing in advance how much you can withdraw and what will remain invested.

How SWP Calculators Work

An SWP Calculator calculates your regular withdrawals and the remaining value of your investment using a specific formula:

A= PMT ((1+rn)nt−1/ rn)


  • A = Future value of the investment
  • PMT = Monthly withdrawal amount
  • r = Annual interest rate
  • n = Number of times SWP interest is compounded per year
  • t = Number of years the money is invested

By inputting the necessary details, the calculator shows how your investment grows or decreases over time with regular withdrawals.

How to Use SWP Calculator

The SWP Calculator helps you figure out the value of your SWP mutual fund investment over a specific period. 

Here’s how to use it:

  1. Enter Total Investment: Fill in the amount you invested in mutual funds.
  2. Enter Monthly Withdrawal: Specify how much you plan to withdraw each month.
  3. Enter Expected Return: Fill in the expected annual rate of return.
  4. Enter Investment Tenure: Provide the duration of your investment in years.

Let’s say you want to invest ₹1,000,000 for 5 years, with monthly withdrawals of ₹5,000, and expect a 12% return. If you enter all of these figures in the SWP calculator, your SWP amount would be approximately ₹1,360,635.


The SWP calculator is a valuable tool for effectively managing your mutual fund investments. It helps you plan how much money you can withdraw regularly without depleting your savings too quickly. This is crucial, especially if you’re retired or looking for a regular income stream from your mutual fund investments.

Understanding how systematic withdrawal plans (SWP) work and using tools like the SWP calculator can make financial planning easier and more effective. It ensures you have a clear idea of your income from investments while preserving the longevity of your savings.

FAQs| SWP Calculator

What is the SWP return rate?

The SWP return rate varies based on how well your mutual funds perform. You can use a SWP calculator to figure out how much you can withdraw each month.

Is SWP better than FD?

For regular income with potential tax benefits and higher returns, SWP can be better than Fixed Deposits (FDs). However, the choice depends on your risk tolerance and financial goals.

Is SWP better than SIP?

SWP isn’t necessarily better than Systematic Investment Plans (SIPs). SWPs are designed to generate regular income from investments, while SIPs are designed to build savings over time.

What are the disadvantages of SWP?

A systematic withdrawal plan in mutual funds includes the risk of losing money during market downturns, some fees for withdrawing, which might lower overall investment gains over time.


Disclaimer: Investments in the securities market are subject to market risks; read all the related documents carefully before investing.