विशेषज्ञ की सलाह चाहिए?हमारे गुरु मदद कर सकते हैं
Ramalingam Kalirajan |10924 Answers |Ask -Follow
Mutual Funds, Financial Planning Expert - Answered on May 15, 2025
Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
Asked by Anonymous - Apr 22, 2025
66 old retiree for SWP for 50 lakhs for 15 years. Please suggest hiwbit works
Ans: You are 66 now. Your earning phase is over. Your investing phase continues.
You must now shift to income generation. That is the priority.
You need monthly income from your investments. That’s where SWP helps.
SWP gives regular money like pension. But with flexibility and better tax benefit.
You have Rs. 50 lakhs corpus. That’s a good amount to begin.
You want it to last 15 years. That’s possible with the right strategy.
SWP gives both safety and growth if planned well. Let us understand this deeply.
What is SWP – Simply Explained
SWP means Systematic Withdrawal Plan. You invest lump sum in a mutual fund.
Then you set a fixed amount to be withdrawn monthly or quarterly.
That amount comes to your bank account like pension or salary.
You can decide the amount and date of withdrawal. It is fully flexible.
The fund continues to grow in the background. Only part of it is withdrawn.
This is better than keeping money in savings or FDs. It earns more.
How Does It Work in Real Life?
You invest Rs. 50 lakhs in suitable mutual funds.
Let us assume monthly withdrawal of Rs. 30,000 as an example.
Every month, this amount comes to your account.
The remaining corpus stays invested and earns returns.
If your fund earns more than withdrawal, your money grows.
If your fund earns less, your capital starts reducing.
The goal is to make your money last full 15 years or more.
That is possible with good fund selection and right withdrawal rate.
Which Mutual Fund Categories Suit Retirees for SWP?
SWP should not be done from aggressive equity funds. Risk is high.
Use conservative hybrid funds or balanced advantage funds.
You can also mix with multi-asset funds and large cap funds.
Avoid small cap, sector funds, and thematic funds.
Safety and stability are more important now than chasing high returns.
A good mix of equity and debt ensures corpus survival.
Gold exposure (via multi-asset fund) gives inflation protection.
Withdrawal Strategy: How Much Is Safe?
From Rs. 50 lakhs, you can safely withdraw Rs. 25,000 to Rs. 30,000 monthly.
That is 6% to 7% annually. It is a sustainable range.
Your fund must earn at least 8% to 9% to preserve capital.
Some years will earn more. Others will earn less.
The idea is to average over time. That gives longevity.
Do annual review with a Certified Financial Planner. Adjust as needed.
Realistic Monthly Withdrawal Table (Assumption Based)
Rs. 50 lakhs invested, withdrawing Rs. 30,000 per month for 15 years:
Total withdrawn over 15 years = Rs. 54 lakhs
Even after 15 years, some corpus may remain if returns stay above 8%.
If markets perform well, you may have Rs. 15–20 lakhs left.
That residual can support your medical or emergency needs after 80.
But don’t start with higher withdrawals. That may finish funds early.
You can increase withdrawal by 3% annually to beat inflation.
Why SWP Is Better Than FD or Savings Account
FD interest is fixed. But inflation eats into returns.
FD interest is fully taxable. That reduces your income.
SWP offers tax-efficiency and potential growth.
SWP is more flexible. You can increase or stop anytime.
You earn higher post-tax return in SWP than FD.
Mutual funds are more efficient in compounding and tax management.
Tax Benefits of SWP (Post 2024 Rules)
Mutual fund withdrawal is partly principal and partly gain.
Only gain portion is taxed. Principal is not taxed.
Long-term capital gains (above Rs. 1.25 lakhs annually) taxed at 12.5%.
Short-term capital gains taxed at 20%.
So your total tax outgo is less than FD interest.
FD interest taxed as per slab. That hurts senior citizens more.
Why You Should Not Invest in Annuity Plans
Annuity gives fixed return. But rates are low – 5% to 6%.
Annuity income is fully taxable. No capital left for heirs.
Once you buy annuity, it is locked. No flexibility.
You cannot change or stop later. No liquidity.
SWP gives more return, more flexibility, and more control.
Why Not Index Funds or ETFs for SWP
Index funds are passive. They cannot manage market downsides.
No human intelligence to shift sectors or reduce exposure.
In a bad year, index may fall 20% or more. No protection.
SWP from index fund in a bad year reduces corpus quickly.
Active funds managed by experts adjust exposure. That reduces damage.
That is why actively managed funds are better for SWP.
Avoid Direct Funds – Use Regular Funds with CFP Monitoring
Direct funds save cost. But you miss expert advice.
You must do your own rebalancing and tax planning.
Retirees need handholding. Mistakes can be costly.
A Certified Financial Planner does fund selection, portfolio review, rebalancing, and planning.
Regular plans give you that support. That is very valuable now.
The extra expense is small. But the guidance is lifelong.
Common Mistakes Retirees Make with SWP
Starting with high withdrawal like Rs. 50,000 per month. That is unsustainable.
Choosing high-risk funds for SWP. That increases capital loss.
Not doing yearly review with CFP. That leads to blind investing.
Pausing or redeeming funds during market dip. That damages recovery.
Not adjusting for inflation annually. That reduces real income.
Investing in ULIPs or endowments. That locks money unnecessarily.
Smart SWP Practices for Long-Term Sustainability
Withdraw 6% or less of corpus annually.
Increase withdrawal 3% every year to beat inflation.
Use two or three fund categories. Not just one.
Keep some money in liquid fund for 6 months income buffer.
Rebalance every year based on market and life needs.
Review with Certified Financial Planner annually. Adjust strategy when needed.
Can You Leave Money for Spouse or Children?
Yes. If planned well, your corpus may not exhaust fully.
You may have Rs. 10–20 lakhs left after 15 years.
That becomes part of your estate. Your spouse can continue SWP.
Or your children can use it for their needs.
Keep nominations updated. Maintain clear records of all folios.
What Happens If You Live Beyond 81?
15-year SWP plan must consider longevity risk.
Medical science is improving. People now live till 90.
So you must plan to extend income even after 81.
Keep some backup corpus or insurance maturity for those years.
Or reduce withdrawal slightly in initial years to extend tenure.
Medical Expenses – How to Plan
Keep a separate Rs. 10–15 lakhs in FD or liquid funds for medical.
Don’t use SWP corpus for health emergency.
Keep health insurance renewed till age 80+.
Opt for higher cover through super top-up plan. Premium is low.
This preserves SWP for income. Insurance takes care of hospital bills.
Final Insights
At 66, SWP is your best tool for regular income.
It gives control, flexibility, and tax efficiency.
A well-planned Rs. 50 lakhs corpus can support you for 15+ years.
Withdraw wisely. Don’t be greedy. Stick to 6–7% annually.
Use hybrid and multi-asset funds. Not pure equity. Not real estate.
Don’t touch annuity, direct funds, or index funds.
Monitor annually with a Certified Financial Planner.
You will enjoy peace of mind, freedom, and financial dignity in retirement.
And if you live beyond 81, you’ll still have financial support.
SWP works like a calm river. Slowly flowing, yet giving life every day.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment
You must now shift to income generation. That is the priority.
You need monthly income from your investments. That’s where SWP helps.
SWP gives regular money like pension. But with flexibility and better tax benefit.
You have Rs. 50 lakhs corpus. That’s a good amount to begin.
You want it to last 15 years. That’s possible with the right strategy.
SWP gives both safety and growth if planned well. Let us understand this deeply.
What is SWP – Simply Explained
SWP means Systematic Withdrawal Plan. You invest lump sum in a mutual fund.
Then you set a fixed amount to be withdrawn monthly or quarterly.
That amount comes to your bank account like pension or salary.
You can decide the amount and date of withdrawal. It is fully flexible.
The fund continues to grow in the background. Only part of it is withdrawn.
This is better than keeping money in savings or FDs. It earns more.
How Does It Work in Real Life?
You invest Rs. 50 lakhs in suitable mutual funds.
Let us assume monthly withdrawal of Rs. 30,000 as an example.
Every month, this amount comes to your account.
The remaining corpus stays invested and earns returns.
If your fund earns more than withdrawal, your money grows.
If your fund earns less, your capital starts reducing.
The goal is to make your money last full 15 years or more.
That is possible with good fund selection and right withdrawal rate.
Which Mutual Fund Categories Suit Retirees for SWP?
SWP should not be done from aggressive equity funds. Risk is high.
Use conservative hybrid funds or balanced advantage funds.
You can also mix with multi-asset funds and large cap funds.
Avoid small cap, sector funds, and thematic funds.
Safety and stability are more important now than chasing high returns.
A good mix of equity and debt ensures corpus survival.
Gold exposure (via multi-asset fund) gives inflation protection.
Withdrawal Strategy: How Much Is Safe?
From Rs. 50 lakhs, you can safely withdraw Rs. 25,000 to Rs. 30,000 monthly.
That is 6% to 7% annually. It is a sustainable range.
Your fund must earn at least 8% to 9% to preserve capital.
Some years will earn more. Others will earn less.
The idea is to average over time. That gives longevity.
Do annual review with a Certified Financial Planner. Adjust as needed.
Realistic Monthly Withdrawal Table (Assumption Based)
Rs. 50 lakhs invested, withdrawing Rs. 30,000 per month for 15 years:
Total withdrawn over 15 years = Rs. 54 lakhs
Even after 15 years, some corpus may remain if returns stay above 8%.
If markets perform well, you may have Rs. 15–20 lakhs left.
That residual can support your medical or emergency needs after 80.
But don’t start with higher withdrawals. That may finish funds early.
You can increase withdrawal by 3% annually to beat inflation.
Why SWP Is Better Than FD or Savings Account
FD interest is fixed. But inflation eats into returns.
FD interest is fully taxable. That reduces your income.
SWP offers tax-efficiency and potential growth.
SWP is more flexible. You can increase or stop anytime.
You earn higher post-tax return in SWP than FD.
Mutual funds are more efficient in compounding and tax management.
Tax Benefits of SWP (Post 2024 Rules)
Mutual fund withdrawal is partly principal and partly gain.
Only gain portion is taxed. Principal is not taxed.
Long-term capital gains (above Rs. 1.25 lakhs annually) taxed at 12.5%.
Short-term capital gains taxed at 20%.
So your total tax outgo is less than FD interest.
FD interest taxed as per slab. That hurts senior citizens more.
Why You Should Not Invest in Annuity Plans
Annuity gives fixed return. But rates are low – 5% to 6%.
Annuity income is fully taxable. No capital left for heirs.
Once you buy annuity, it is locked. No flexibility.
You cannot change or stop later. No liquidity.
SWP gives more return, more flexibility, and more control.
Why Not Index Funds or ETFs for SWP
Index funds are passive. They cannot manage market downsides.
No human intelligence to shift sectors or reduce exposure.
In a bad year, index may fall 20% or more. No protection.
SWP from index fund in a bad year reduces corpus quickly.
Active funds managed by experts adjust exposure. That reduces damage.
That is why actively managed funds are better for SWP.
Avoid Direct Funds – Use Regular Funds with CFP Monitoring
Direct funds save cost. But you miss expert advice.
You must do your own rebalancing and tax planning.
Retirees need handholding. Mistakes can be costly.
A Certified Financial Planner does fund selection, portfolio review, rebalancing, and planning.
Regular plans give you that support. That is very valuable now.
The extra expense is small. But the guidance is lifelong.
Common Mistakes Retirees Make with SWP
Starting with high withdrawal like Rs. 50,000 per month. That is unsustainable.
Choosing high-risk funds for SWP. That increases capital loss.
Not doing yearly review with CFP. That leads to blind investing.
Pausing or redeeming funds during market dip. That damages recovery.
Not adjusting for inflation annually. That reduces real income.
Investing in ULIPs or endowments. That locks money unnecessarily.
Smart SWP Practices for Long-Term Sustainability
Withdraw 6% or less of corpus annually.
Increase withdrawal 3% every year to beat inflation.
Use two or three fund categories. Not just one.
Keep some money in liquid fund for 6 months income buffer.
Rebalance every year based on market and life needs.
Review with Certified Financial Planner annually. Adjust strategy when needed.
Can You Leave Money for Spouse or Children?
Yes. If planned well, your corpus may not exhaust fully.
You may have Rs. 10–20 lakhs left after 15 years.
That becomes part of your estate. Your spouse can continue SWP.
Or your children can use it for their needs.
Keep nominations updated. Maintain clear records of all folios.
What Happens If You Live Beyond 81?
15-year SWP plan must consider longevity risk.
Medical science is improving. People now live till 90.
So you must plan to extend income even after 81.
Keep some backup corpus or insurance maturity for those years.
Or reduce withdrawal slightly in initial years to extend tenure.
Medical Expenses – How to Plan
Keep a separate Rs. 10–15 lakhs in FD or liquid funds for medical.
Don’t use SWP corpus for health emergency.
Keep health insurance renewed till age 80+.
Opt for higher cover through super top-up plan. Premium is low.
This preserves SWP for income. Insurance takes care of hospital bills.
Final Insights
At 66, SWP is your best tool for regular income.
It gives control, flexibility, and tax efficiency.
A well-planned Rs. 50 lakhs corpus can support you for 15+ years.
Withdraw wisely. Don’t be greedy. Stick to 6–7% annually.
Use hybrid and multi-asset funds. Not pure equity. Not real estate.
Don’t touch annuity, direct funds, or index funds.
Monitor annually with a Certified Financial Planner.
You will enjoy peace of mind, freedom, and financial dignity in retirement.
And if you live beyond 81, you’ll still have financial support.
SWP works like a calm river. Slowly flowing, yet giving life every day.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
MoneyReply
आप नीचे ऐसेही प्रश्न और उत्तर देखना पसंद कर सकते हैं
Sanjeev Govila | Answer |Ask -Follow
Financial Planner - Answered on Dec 06, 2023
Question by N - Dec 03, 2023English
Ramalingam Kalirajan |10924 Answers |Ask -Follow
Mutual Funds, Financial Planning Expert - Answered on Apr 15, 2024
Ramalingam Kalirajan |10924 Answers |Ask -Follow
Mutual Funds, Financial Planning Expert - Answered on Apr 01, 2025
नवीनतम प्रश्न
Purshotam Lal |70 Answers |Ask -Follow
Financial Planner, MF and Insurance Expert - Answered on Dec 23, 2025
Purshotam Lal |70 Answers |Ask -Follow
Financial Planner, MF and Insurance Expert - Answered on Dec 23, 2025
Samraat Jadhav |2522 Answers |Ask -Follow
Stock Market Expert - Answered on Dec 23, 2025
Samraat Jadhav |2522 Answers |Ask -Follow
Stock Market Expert - Answered on Dec 23, 2025
Samraat Jadhav |2522 Answers |Ask -Follow
Stock Market Expert - Answered on Dec 23, 2025
Samraat Jadhav |2522 Answers |Ask -Follow
Stock Market Expert - Answered on Dec 23, 2025
Samraat Jadhav |2522 Answers |Ask -Follow
Stock Market Expert - Answered on Dec 23, 2025
Dr Nagarajan J S K |2578 Answers |Ask -Follow
NEET, Medical, Pharmacy Careers - Answered on Dec 23, 2025
Samraat Jadhav |2522 Answers |Ask -Follow
Stock Market Expert - Answered on Dec 23, 2025
Ramalingam Kalirajan |10924 Answers |Ask -Follow
Mutual Funds, Financial Planning Expert - Answered on Dec 23, 2025
