SWP Calculator
Planning to withdraw from your mutual fund investments? SWP Calculator lets you explore different withdrawal amounts and instantly see how your corpus and returns play out over time.
Total Investment
Withdrawal per month
Expected Return Rate (p.a)
Time Period
Total investment
₹ 5,00,000
Total withdrawal
₹ 6,00,000
Total Interest
₹ 1,05,218
Final value
₹ 5,218
What Is an SWP (Systematic Withdrawal Plan)?
An SWP Calculator is an essential financial tool that helps you plan regular, sustainable cash flows from your mutual fund investments.
Investors withdraw a portion of the investment through the redemption of mutual fund units. Units that are not redeemed remain invested in the scheme. The withdrawal amount is decided when the SWP is set up. The schedule and duration are chosen at the same time. An SWP Calculator ensures your corpus lasts as long as needed by balancing your periodic withdrawals against potential investment returns. Most investors usually opt for monthly withdrawals. But some investors prefer quarterly or annual schedules as per their financial needs.
SWP Calculator Formula
Two formulas are commonly used in a systematic withdrawal plan calculator. One estimates the value of the withdrawals. Another estimates the corpus remaining after those withdrawals.
Formula for Total Value of Withdrawals: A = PMT × [((1 + r/n)^(n × t) − 1) ÷ (r/n)]
Where,
PMT = Amount withdrawn in each period
r = Expected annual return rate
n = Number of compounding periods in a year
t = Investment tenure in years
A = Total value of withdrawals
Formula for Remaining Corpus: Ct = C0 × (1 + i)^t − W × [((1 + i)^t − 1) ÷ i]
Where,
C0 = Initial investment amount
W = Periodic withdrawal amount
i = Return rate for each withdrawal period
t = Number of withdrawal periods
Ct = Corpus remaining after withdrawals
SWP Calculation Example
Let us look at an example of SWP calculator. Assume an investment of ₹5,00,000 with 10% return per annum. It has a monthly withdrawal of ₹10,000. The table below tracks the corpus over 12 months.
1 | ₹5,00,000 | ₹10,000 | ₹3,987 | ₹4,93,987 |
2 | ₹4,93,987 | ₹10,000 | ₹3,939 | ₹4,87,926 |
3 | ₹4,87,926 | ₹10,000 | ₹3,891 | ₹4,81,817 |
4 | ₹4,81,817 | ₹10,000 | ₹3,842 | ₹4,75,659 |
5 | ₹4,75,659 | ₹10,000 | ₹3,793 | ₹4,69,452 |
6 | ₹4,69,452 | ₹10,000 | ₹3,743 | ₹4,63,196 |
7 | ₹4,63,196 | ₹10,000 | ₹3,694 | ₹4,56,889 |
8 | ₹4,56,889 | ₹10,000 | ₹3,643 | ₹4,50,532 |
9 | ₹4,50,532 | ₹10,000 | ₹3,593 | ₹4,44,125 |
10 | ₹4,44,125 | ₹10,000 | ₹3,542 | ₹4,37,667 |
11 | ₹4,37,667 | ₹10,000 | ₹3,490 | ₹4,31,157 |
12 | ₹4,31,157 | ₹10,000 | ₹3,438 | ₹4,24,595 |
Over 12 months, ₹1,20,000 is withdrawn from the investment. Based on that alone, the corpus would fall to ₹3,80,000. The closing balance is about ₹4,25,000 instead. Part of the corpus that remains invested continues to earn interest. This leads to a higher closing balance.
How To Use Kotak Neo's SWP Calculator
Only a few inputs are required to run an SWP calculation. Enter the details below and the calculator will generate the results instantly.
Step 1: Enter the total investment amount on which the SWP will be based
Step 2: Select the amount you plan to withdraw monthly
Step 3: Set the expected annual return rate for the investment
Step 4: Choose the SWP tenure
The calculator gives you the remaining corpus, total withdrawal amount, and portfolio value.
Benefits Of Using an SWP Calculator
An SWP calculator can be useful at different stages of withdrawal planning.
- You can assess whether the withdrawal amount is proportionate to the corpus.
- You get a rough estimate of the remaining balance before starting an SWP.
- Different withdrawal frequencies can be explored using the same investment amount.
- You can compare multiple return assumptions for the same corpus.
- It takes you only a few moments to run several calculations.
SWP vs SIP - Key Differences
SIP stands for Systematic Investment Plan. SWP and SIP are both linked to mutual funds, but they serve different purposes. The choice between SIP and SWP depends on the investment objective. An SIP is generally used to build an investment corpus over time. An SWP is used to withdraw money from an existing investment at regular intervals.
Purpose | Regular withdrawal from an existing corpus | Regular investment to build a corpus |
Cash Flow Direction | Money moves from the mutual fund to the investor | Money moves from the investor to the mutual fund |
Ideal For | Investors looking for periodic income | Investors looking to accumulate wealth |
Units | Mutual fund units are redeemed | Mutual fund units are purchased |
Best Stage | Wealth distribution stage | Wealth creation stage |
Impact Of Inflation On SWP
Many investors use SWPs for their monthly expenses. The withdrawal amount may, however, remain unchanged for years. ₹50,000 today and ₹50,000 ten years later may not have the same spending value due to inflation.
So, while planning an SWP, inflation is an important factor worth considering. An inflation assumption of 6-7% is considered ideal while estimating the tenure of an SWP. Some investors also increase the withdrawal amount from time to time. An SWP calculator with inflation can be used while planning for this.
FAQs About SWP Calculator
An SWP (Systematic Withdrawal Plan) Calculator is an online tool that helps investors estimate how long their investment corpus will last while receiving a fixed, periodic payout. [SS1.1]The calculator works on the basis of corpus amount, withdrawal amount, return rate and tenure. The output also includes the remaining corpus and total withdrawals.
The ideal annual withdrawal rate for a Systematic Withdrawal Plan (SWP) typically ranges between 5%-6% of your total corpus.
Yes, you can easily change your SWP (Systematic Withdrawal Plan) amount or frequency after it has started. Most fund houses and investment platforms allow you to modify, pause, or completely cancel your withdrawals anytime.
Every SWP withdrawal is treated as a mutual fund redemption. Tax applies only to the gains portion. They are classified as Short-Term Capital Gain (STCG) or Long-Term Capital Gain (LTCG). The tax on STCG is 20%. LTCG is taxed at 12.5% if gains exceed ₹1.25 Lakh.
A Systematic Withdrawal Plan (SWP) is generally considered better than mutual fund dividends, now known as IDCW (Income Distribution cum Capital Withdrawal), because it provides predictable cash flows, better control, and significant tax efficiency.
When a Systematic Withdrawal Plan (SWP) corpus runs out, the mutual fund automatically stops redeeming units, and all monthly payouts cease. Your investment balance becomes zero, meaning you no longer have a safety net or a generating asset to support your cash flow.
Monthly, quarterly, and yearly frequencies are commonly available. The same SWP can be structured differently depending on the chosen payout schedule.
Mutual fund investments are subject to market risks. Read all scheme-related documents carefully.
