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Ramalingam Kalirajan |11166 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on Sep 03, 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

Asked by Anonymous - Sep 02, 2025Hindi

I want to put 2 lacs now and later in November 3 lacs in swp i am 64 yeas could you please suggest some scheme to me and also whether the swp amt in turn can be put in sip.i already am having sip of 40000 in hdfc sbi dsp edelweiss etc.

Ans: – You have planned very well at this stage of life.
– Many ignore money decisions at 64, but you are proactive.
– You already run Rs.40,000 monthly SIPs, which shows good financial discipline.
– Adding lump sum and SWP is a smart next step.

» Understanding your current age and needs
– At 64, income stability and capital safety are most important.
– Your money must give you liquidity, growth, and comfort.
– Risk-taking should be moderate, not very high.
– You must ensure your money lasts for long years.

» About your Rs.2 lakh now and Rs.3 lakh later
– These lump sums should not go into direct equity.
– They can be deployed in a mix of balanced and debt-oriented funds.
– These will reduce volatility and still give better growth than FD.
– Splitting money over two periods is a safe staggered plan.

» SWP and its working
– Systematic Withdrawal Plan (SWP) gives you monthly income from invested money.
– You can choose fixed monthly withdrawal amount.
– It is better than FD interest because of better taxation and flexibility.
– You can use it as a pension-like income source.

» SWP amount going back into SIP
– This idea is interesting but needs caution.
– SWP is for withdrawing money to spend, not reinvest.
– If you withdraw and again put into SIP, you may create tax leakages.
– Instead, decide if you truly need that SWP income.
– If not needed, keep the amount invested without withdrawal.
– This avoids double movement and extra taxation.

» Analysing SIP continuation
– Your current SIP of Rs.40,000 is already strong.
– It shows you have growth orientation even after 60.
– You can continue this as long as your expenses are met.
– Adding more SIP from SWP may complicate things.
– Instead, directly increase your SIP if you want.

» Disadvantages of direct funds
– Many investors prefer direct funds for saving small commissions.
– But direct funds remove the guidance of a Certified Financial Planner.
– You may miss rebalancing advice, tax-efficient withdrawals, and goal clarity.
– A regular fund through a CFP or MFD ensures handholding and ongoing strategy.
– At 64, professional help is more valuable than saving 0.5–1% expense ratio.
– Wrong exit or entry timing can cost more than saved expense.

» Disadvantages of index funds
– Index funds look simple but have many issues.
– They copy index blindly, with no active risk control.
– During market falls, they also fall fully without protection.
– They cannot book profits during highs, unlike active funds.
– For someone at 64, volatility of index funds is dangerous.
– Actively managed funds with skilled managers provide balance of growth and safety.

» Importance of tax treatment in your age
– SWP withdrawals from equity-oriented funds are taxed favourably.
– New rules apply: gains above Rs.1.25 lakh yearly taxed at 12.5%.
– Short-term gains taxed at 20%.
– Debt fund withdrawals taxed as per your slab.
– Planning the right mix can save taxes.
– Taking CFP support helps avoid unnecessary tax hit.

» Balancing safety and growth
– At this age, do not take 100% equity exposure.
– Debt allocation should be at least 40–50%.
– Balanced allocation will reduce panic during market falls.
– Some money can be kept liquid for medical or sudden needs.

» Role of your existing SIP in HDFC, SBI, DSP, Edelweiss
– These are good names with strong fund history.
– Continue these SIPs if they align with your risk profile.
– Ensure diversification between large-cap, multi-cap, and hybrid categories.
– Avoid duplication of similar type funds.
– Review once a year with a CFP to adjust.

» Better approach than SWP to SIP loop
– If your purpose is not regular monthly spending, avoid SWP.
– Instead, let the lump sum stay invested in hybrid funds.
– Increase your existing SIP directly if you want extra investment.
– This removes unnecessary transactions and tax.

» Why avoid overcomplication
– At 64, money handling should be simple.
– Too many entries and exits can confuse and create tax burden.
– Keep one clear flow: SIP for growth, SWP for income.
– Mixing both may dilute benefits.

» Cash flow planning importance
– First, write down your monthly income needs.
– Check what pension, FD, or SCSS is already covering.
– SWP should only fill the gap.
– If there is no gap, no need for SWP now.
– This clarity avoids future stress.

» Emergency fund role
– Keep at least 12 months of expenses in a safe place.
– This can be in bank FD or liquid fund.
– This ensures SWP or SIP is not disturbed by sudden expense.
– Emergency fund is very critical at 64.

» Healthcare preparedness
– Medical costs rise after 60.
– Check if you have enough health insurance coverage.
– Also keep some corpus in debt funds as health buffer.
– This prevents forced sale of long-term investments.

» Estate and succession planning
– At 64, plan nominations and joint holding carefully.
– Decide who will manage investments after you.
– Discuss with family to avoid confusion later.
– Keeping money in easy to handle instruments helps heirs.

» Risk awareness at your stage
– Equity has potential but comes with volatility.
– A 20–30% fall can create fear at 64.
– That is why hybrid approach is safer.
– Always match allocation to comfort level.

» Psychological comfort
– SWP gives steady income and peace of mind.
– SIP gives growth feel and hope for future.
– Both combined give balance of income and growth.
– Avoid making them overlap unnecessarily.

» Finally
– Your planning spirit at 64 is inspiring.
– Deploy Rs.2 lakh now and Rs.3 lakh later into hybrid or debt-oriented funds.
– Use SWP only if you need monthly income.
– Avoid routing SWP back into SIP, as it creates tax leakages.
– Instead, increase SIP directly if you want more growth.
– Stay with actively managed regular funds with CFP support, not direct or index funds.
– Maintain emergency corpus and health cover.
– Review yearly with a Certified Financial Planner for safety, income, and growth balance.

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.

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