MAM
Maximising your retirement corpus with SWP in mutual funds
A comfortable retirement depends on not just a well-built corpus but also a strategic approach to manage it. A Systematic Withdrawal Plan (SWP) in mutual funds offers retirees the ideal blend of regular income and sustained growth. With SWP, retirees can withdraw a fixed sum at regular intervals while keeping their investments active in the market, ensuring financial independence and longevity of their savings.
What is SWP and why is it beneficial?
SWP allows you to withdraw a pre-determined amount from your mutual fund investment at intervals you choose – monthly, quarterly, or annually. Unlike lump-sum withdrawals, an SWP ensures a steady cash flow while your remaining investment continues to generate returns.
Here’s why SWP is ideal for retirees:
1. Regular income: It replaces a salary, providing a steady stream of money to cover monthly expenses.
2. Tax efficiency: Withdrawals are taxed on the gains component only, unlike fixed deposits, which are fully taxable.
3. Market participation: Even after withdrawals, the remaining corpus stays invested, benefiting from market-linked growth.
4. Flexibility: You can modify or stop SWP as your needs change.
Steps to maximise your retirement corpus with SWP
1. Choose the right funds
Selecting the right mutual funds is key. Retirees may opt for:
. Hybrid funds: A mix of equity and debt for balanced risk and returns.
. Debt funds: For stability and consistent returns.
. Equity funds: Higher returns but suitable only for those comfortable with moderate risk.
2. Set realistic withdrawal rates
To ensure your funds last, stick to a withdrawal rate of 4-5% annually. Overdrawing may deplete your corpus quickly, while under-withdrawing may leave funds underutilised.
3. Account for inflation
Expenses will rise over time due to inflation. Plan SWP increments periodically to ensure your purchasing power remains intact.
4. Monitor and rebalance
Markets fluctuate, and your risk tolerance may change as you age. Regularly review your portfolio and rebalance to align with your evolving financial goals. For instance, gradually shifting more funds into safer debt instruments as you grow older can protect your corpus.
Example of SWP in action
Let’s assume you invest Rs. 50 lakh in a hybrid mutual fund earning 10% annual returns. With a withdrawal rate of Rs. 40,000 per month (Rs. 4.8 lakh per year), you’ll still grow your corpus over time because the returns outpace withdrawals. This sustainable strategy ensures that your wealth lasts longer while meeting your financial needs.
Advantages of SWP over other options
. Better liquidity: Unlike fixed deposits, SWPs provide regular income without locking in your funds.
. Wealth preservation: Your corpus remains invested, offering the potential for inflation-beating growth.
. Low emotional bias: Automation prevents emotional decision-making during market volatility.
Conclusion
An SWP is an excellent strategy for retirees seeking steady income without compromising the growth of their savings. By choosing the right funds, setting sustainable withdrawal rates, and accounting for inflation, retirees can enjoy financial stability and peace of mind. SWP ensures your retirement corpus not only sustains your golden years but also leaves behind a legacy for the next generation. With an SWP, you’re not just withdrawing money – you’re maximising the potential of your hard-earned wealth.
Brands
YES Bank hands the keys to SBI veteran Vinay Tonse as it bets on a new era
Former SBI managing director appointed as YES Bank’s new MD and CEO
MUMBAI: YES Bank is done rebuilding. Now it wants to grow. The private sector lender has appointed Vinay Muralidhar Tonse as managing director and chief executive officer-designate, with RBI approval secured and a start date of April 6, 2026 confirmed. The three-year term signals the bank’s intent to shift gears from crisis recovery to full-throttle expansion.
Tonse, 60, is no stranger to scale. Most recently managing director at State Bank of India, he oversaw a retail book of roughly $800bn in deposits and advances, one of the largest in the country. Before that, he ran SBI Mutual Fund from August 2020 to December 2022, a stint that saw assets under management surge from Rs 4.32 lakh crore to Rs 7.32 lakh crore across market cycles. Add stints in Singapore and four years leading SBI’s overseas operations in Osaka, and the incoming chief arrives with a genuinely global CV.
His academic grounding is equally solid: a commerce degree from St Joseph’s College of Commerce, Bengaluru, and a master’s in commerce from Bangalore University.
The appointment follows an extensive search and evaluation process by the bank’s Nomination and Remuneration Committee. NRC chairperson Nandita Gurjar said the committee unanimously backed Tonse, citing his leadership track record, governance credentials and ability to drive the bank’s next phase of transformation.
Non-executive chairman Rama Subramaniam Gandhi was unequivocal. “I am certain that Vinay Tonse, with his vast experience as a senior banker, will propel YES Bank to its next phase of growth,” Gandhi said, adding that the bank remains focused on strengthening its retail and corporate banking franchises and expanding its branch network.
Rajeev Kannan, non-executive director and senior executive at Sumitomo Mitsui Banking Corporation, the bank’s largest shareholder, said Tonse’s experience across retail, corporate banking, global markets and asset management positioned him well to lead the lender. SMBC said it looks forward to working with Tonse and the board as YES Bank pursues its ambition of becoming a top-tier private sector lender anchored in strong governance and sustainable growth.
Tonse succeeds Prashant Kumar, who took the helm in March 2020 when YES Bank was in freefall following a severe financial crisis, and spent six years painstakingly stabilising the institution, rebuilding governance and restoring operational scale. Gandhi was generous: “The bank remains indebted to Prashant Kumar, who is responsible for much of what a strong financial powerhouse YES Bank is today.”
Tonse, for his part, struck a purposeful note. “Together with the board and my colleagues, I remain deeply committed to creating long-term value for all our stakeholders,” he said, pledging to build on Kumar’s foundation guided by his personal motto: Make A Difference.
Beyond the balance sheet, Tonse played cricket at college and club level and represented Karnataka in archery at the national championships — sports he credits with teaching him teamwork, situational leadership, discipline and focus. In quieter moments, he reaches for retro Kannada music, classic Hindi songs, and the crooning of Engelbert Humperdinck, Mukesh and Kishore Kumar.
YES Bank has its steady-handed rebuilder in Kumar to thank for survival. Now it has a scale-obsessed growth banker at the wheel. The next chapter starts April 6.
