SWP Tips: Earn a lifetime income with just ₹1 crore! Know the easy formula of SWP..

Have you ever thought that if you have ₹ 1 crore, you can live your whole life comfortably without doing any job? It sounds like a dream but if you invest wisely, then it is possible. If the money is invested in the right place, then not only your future is secure, but your children can also get its benefits. The easiest and most effective way is a Systematic Withdrawal Plan (SWP). Let us explain to you how you can earn every month by investing ₹ 1 crore in the right way and how this SWP works.

What is SWP and how does it work?

SWP means Systematic Withdrawal Plan, which you can call the opposite brother of SIP. While in SIP you deposit money every month, in SWP you can withdraw a fixed amount every month by investing a lump sum amount. Suppose, you invested 1 crore rupees in a mutual fund. Now you will get returns on this amount every year. Mutual funds give an average annual return of 12-15%, but experts advise not to expect more than 8% return for SWP. This is because the market keeps fluctuating and caution is necessary for stable returns over a long period. The biggest advantage of SWP is that you can withdraw money every month as per your requirement and the remaining amount keeps growing in the mutual fund. How much money can you withdraw every month? In SWP, you have to keep in mind that you cannot withdraw too much money every month, otherwise, your principal amount will start decreasing. Suppose, you have invested Rs 1 crore in a mutual fund, which is giving an 8% annual return. In this situation, you can easily withdraw Rs 50,000 every month, and that too for a lifetime! The surprising thing is that even if you withdraw Rs 50,000 every month for 30 years, your principal amount will not only remain intact but will also increase to more than Rs 3 crore.

SWP Calculation (8% return on ₹1 crore)
Investment amount: ₹1,00,00,000
Annual estimated return: 8%
Monthly estimated return: 0.67% (8% ÷ 12)
Monthly return amount: ₹66,667
Monthly withdrawal (SWP): ₹50,000
Remaining return (reinvested in the fund): ₹16,667
Total withdrawal in 30 years: ₹1.8 crore (₹50,000 × 12 × 30)
Estimated fund value after 30 years: ₹3.1 crore+

The magic of compound interest
The biggest strength of SWP is compound interest. This is such magic that multiplies your money manifold in the long run. By investing in mutual funds for a long time, your capital not only remains safe, but it also increases tremendously. However, it is important to keep some things in mind before investing in mutual funds. First, take the advice of a good financial advisor. He can tell you which mutual fund is right for you. Second, there is a risk of fluctuations in the market, so do not always expect more than 8% return. Third, decide the amount of withdrawal every month according to your needs, so that your original capital remains intact.

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