I had a lump sum amount of 60 lakhs, which I received during retirement. I have invested 30 lakhs in an FD with SBI for 5 years. I am thinking of investing in SWP.What would be best in SWP or where else can I invest this money? Also, I don't want a long lock-in period as I hv my daughter's marriage in future, also my son is studying in college.

Ans: You are retired, received Rs 60 lakhs, and already parked Rs 30 lakhs in a fixed deposit. Your goals are clearly defined—your daughter’s marriage and your son’s education. You are now considering where to invest the remaining Rs 30 lakhs, and whether SWP is suitable.

Let us evaluate everything in a 360-degree manner and create a structured investment roadmap.

Understanding Your Situation First

You have retired with Rs 60 lakhs as corpus.

You have already invested Rs 30 lakhs in a 5-year SBI FD.

You are now looking to invest the balance Rs 30 lakhs.

You want:

Safe and steady returns

No long lock-in

Flexibility for daughter’s marriage and son’s education

You are also considering SWP (Systematic Withdrawal Plan) as a possible option.

This thinking is practical and timely.

Let’s now build the plan step by step.

FD – Pros and Limitations

Rs 30 lakhs is already in a 5-year FD.

That is your capital protection portion.

FD gives fixed interest, but it has some problems:

Interest is fully taxable

Rate is not inflation-beating

No liquidity until maturity (unless you break it)

Not suitable for long-term wealth creation

FD works for short-term or capital safety. That’s all.

You already parked 50% of your retirement money there.

So now, the next Rs 30 lakhs must grow smartly.

You need inflation-beating returns and flexible access.

SWP – Is It Right for You?

SWP (Systematic Withdrawal Plan) is used to create monthly income.

It is not an investment by itself.

You first invest in a mutual fund, then set up SWP.

The fund continues to grow, and you withdraw fixed monthly amount.

So SWP depends on where you invest the capital.

You need a combination of growth, safety, and access.

That is possible only through mutual funds.

But not any mutual fund will do.

You need the right mix of funds, with guidance.

Avoid Index Funds and Direct Plans

While investing the Rs 30 lakhs in mutual funds:

Do not choose index funds

Do not invest in direct plans

Why avoid index funds?

They copy the stock market blindly.

No flexibility to avoid bad stocks.

They cannot manage downside during market fall.

Your money will rise and fall like the market.

In retirement, this risk is not acceptable.

Why avoid direct plans?

Direct plans look cheaper but offer zero support.

You won’t get review, rebalancing, or emotional guidance.

If market drops, you may panic and withdraw.

You will not receive alerts or advice.

Instead, choose regular plans through an MFD backed by a Certified Financial Planner.

This ensures:

Portfolio suited to your risk and goals

SWP structured to avoid capital erosion

Help with taxation, fund switch, and withdrawal

Peace of mind and long-term stability

Best Approach – Divide the Rs 30 Lakhs Wisely

You don’t want long lock-in.

You need some flexibility.

You have future expenses for children.

So let us divide Rs 30 lakhs across different needs:

1. Rs 10 lakhs – Short Term (0 to 2 years)
Keep this portion safe.

Use ultra short-duration debt mutual funds.

These are better than FD for short-term.

They give 5% to 7% return, are liquid, and have no lock-in.

Ideal for your son’s next two years of college.

Do not use bank FD here. It will lock money unnecessarily.

Use SWP or lump sum withdrawal as needed from this portion.

2. Rs 10 lakhs – Medium Term (2 to 5 years)
This is for daughter’s marriage.

Use balanced advantage funds or conservative hybrid funds.

They balance equity and debt.

They grow better than FD, but control downside.

You can plan a partial SWP from here after 2 years.

Or withdraw lumpsum when marriage expenses come.

3. Rs 10 lakhs – Long Term (Beyond 5 years)
You may not need this money urgently.

So invest in actively managed equity mutual funds.

Use large and flexi-cap funds.

Do not withdraw here for at least 5 to 7 years.

Let this grow to support your old age.

This is your growth portion.

Let compounding work.

If needed, you can start SWP after 5 years from this portion too.

How SWP Works in This Setup

Let us say you want Rs 20,000 monthly for regular expenses.

You can set up SWP from debt or balanced funds.

You can also stagger from short and medium term funds.

You can increase SWP later as other goals get completed.

With proper planning, your capital will remain, and only gain is withdrawn.

Unlike FD interest, SWP also gives tax efficiency.

New tax rules apply as follows:

Equity fund gains above Rs 1.25 lakh taxed at 12.5%

Short-term equity gains taxed at 20%

Debt fund gains taxed as per income slab

A Certified Financial Planner can help you structure redemptions in a tax-friendly way.

Emergency Fund Must Not Be Ignored

Keep at least Rs 2 to 3 lakhs as emergency fund.

Use liquid mutual fund or short-duration debt fund.

Avoid keeping this in savings account or FD.

You can access in 24 hours if needed.

Don’t mix this with other investments.

Emergency fund must be untouched unless needed.

Insurance Check is Needed

Even after retirement, health insurance is critical.

If you don’t have personal health cover, take one now.

Mediclaim for senior citizens is costly, but better than hospital bills.

Also, make sure your family knows where your money is invested.

Add nominee in all mutual funds and FDs.

Create a simple Will.

These steps give protection and peace.

Mistakes You Must Avoid Now

You are retired and responsibilities remain.

Avoid these errors:

Don’t put all in FD

Don’t invest in long lock-in schemes

Don’t buy insurance-based investment plans

Don’t fall for ULIPs or annuities

Don’t ignore inflation

Don’t use real estate for returns

Don’t trust unknown agents

Stay with mutual funds and professional guidance only.

When and How to Review Portfolio

Every 6 months, review your plan with your Certified Financial Planner.

Ask these questions:

Is SWP continuing without eating capital?

Are all goals (education, marriage) funded on time?

Is your capital growing above inflation?

Are you taking only necessary risk?

Rebalance portfolio yearly if needed.

Shift from equity to debt as marriage date nears.

Shift from debt to liquid as education fees approach.

Planning is the real safety.

Checklist for You Now

Let’s make it simple:

FD already done: Rs 30 lakhs for capital safety

Emergency fund: Rs 2 lakhs in liquid fund

Rs 10 lakhs: Ultra short fund (son’s college)

Rs 10 lakhs: Balanced fund (daughter’s marriage)

Rs 10 lakhs: Equity fund (long-term growth)

Set up SWP from short and balanced funds

Avoid index funds and direct plans

Use regular funds with MFD + CFP help

Review tax impact of every withdrawal

Reassess goals yearly

This plan keeps you flexible, safe, and growing.

You stay prepared for every family need.

Finally

You are thinking smartly at the right time.

Most people park entire retirement money in FD.

You didn’t.

You chose balance, flexibility, and growth.

Now take the next step with structured mutual fund strategy.

Let SWP serve you steadily.

Let your capital grow silently.

And let your financial peace stay intact.

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment