top of page

By:

Kaustubh Kale

10 September 2024 at 6:07:15 pm

SIP vs STP vs SWP

In mutual funds, investors often hear three important terms - SIP, STP and SWP. These may sound technical, but they are actually simple and powerful facilities provided by mutual funds. They help investors invest, transfer and withdraw money in a disciplined and automated manner. Systematic Investment Plan This is the most commonly known concept. In an SIP, a fixed amount is automatically debited from your bank account on a fixed date and invested into selected mutual fund schemes. For...

SIP vs STP vs SWP

In mutual funds, investors often hear three important terms - SIP, STP and SWP. These may sound technical, but they are actually simple and powerful facilities provided by mutual funds. They help investors invest, transfer and withdraw money in a disciplined and automated manner. Systematic Investment Plan This is the most commonly known concept. In an SIP, a fixed amount is automatically debited from your bank account on a fixed date and invested into selected mutual fund schemes. For example, if a 30-year-old investor starts investing INR 10,000 per month for retirement and continues till the age of 55, the investment period is 25 years. Assuming a long-term return of around 12% per annum, this monthly investment can grow to approximately INR 1.70 crores. Please note, INR 10,000 is only a small amount used for illustration. Your SIP amount should be sufficient for your goals. Ideally, investors should try to invest at least 30% of their in-hand monthly income. The biggest benefit of SIP is discipline. You do not have to remember to invest every month. The process is automated. SIP also helps you invest through market ups and downs, reducing the stress of timing the market. That is why SIP is also popularly called Sapna-In-Progress. Systematic Transfer Plan In SIP, money moves from your bank account to a mutual fund. In STP, money moves from one mutual fund scheme to another. This is especially useful when you have a lumpsum amount but do not want to invest it into equity funds in one shot. For example, an investor has INR 20 lakhs to invest for the long term. He may worry about market volatility if the entire amount is invested at one go. In such a case, the money can first be parked in a debt mutual fund, and then gradually transferred to an equity mutual fund through STP. For example, INR 40,000 can be transferred every week over around 50 weeks. STP is flexible in terms of duration, frequency, amount and choice of schemes. STP gives comfort, automation and gradual participation in equity markets. Systematic Withdrawal Plan This is the exact reverse of SIP. In SIP, money goes from your bank account to a mutual fund. In SWP, money comes from your mutual fund to your bank account at regular intervals. SWP can be very useful after retirement. Suppose an investor has built a corpus of around INR 10 crores by the age of 55. He can set up an SWP to receive, say, INR 5 lakhs per month for his regular expenses. If the corpus is invested wisely with proper asset allocation, the investor can receive regular income and still allow the balance corpus to grow over time. To understand the power of this, consider an actual scheme’s past performance. A corpus of INR 10 crores would have grown to around INR 30 crores over 15 years, even after the investor withdrew INR 5 lakhs every month. In simple words, SIP helps you invest regularly, STP helps you transfer wisely, and SWP helps you withdraw systematically. Used properly, these three tools can make wealth creation and retirement planning more disciplined, automated and peaceful. (The author is Chartered Accountant and CFA (USA). Financial advisor. Views personal. He could be reached on 9833133605)

Border residents calm but anxious

  • PTI
  • May 9, 2025
  • 4 min read
People in village Maahwa at Attari in Amritsar district on Friday. Pic: PTI
People in village Maahwa at Attari in Amritsar district on Friday. Pic: PTI

Chandigarh/Jaisalmer: Schools were closed, most people stayed indoors and the occasional siren rang out as people in many border districts woke up to a tense Friday morning, calm but anxious about what the day would bring.


The night that was had been nerve-wracking with blackouts, loud blasts piercing through the quiet and the fear that their homes would be the frontier of war between India and its fractious neighbour Pakistan.


It passed off without further incident, much to the relief of those living in the border areas of Rajasthan and Punjab.


While Punjab shares a 532-km border with Pakistan, in Rajasthan, the border stretches about 1,070 km.


People in several border districts of Punjab, including Amritsar, Pathankot, Ferozepur and Gurdaspur, spent an anxious night as authorities enforced a complete blackout amid the heightened tensions.


In Pathankot, where some locals claimed they heard explosion-like sounds on Thursday night, calm prevailed on Friday morning.


Some locals said though they were anxious over the developments, they were confident as India's armed forces were swiftly thwarting Pakistan's attempts.


In the key border districts of Amritsar and Ferozepur, too, calm prevailed on Friday morning.


Apprehensive of rumours

A few residents in Ferozepur told PTI Videos that while the atmosphere remained by and large calm on Friday morning, they were more apprehensive of the rumours doing the rounds.


In Bathinda, a local told PTI Videos, “There was a lot sound of firing till midnight amid a complete blackout. We spent the night in fear, but things were calm today morning."


Special prayers for peace were also held at some gurdwaras in the state, including in Mohali and Rupnagar, amid the soaring tensions.


Baldev Chand, an elderly man in Chandigarh who stuck to his routine morning walk on Friday, said while there were some anxious moments the previous night, there was nothing to worry given the way the Indian armed forces thwarted Pakistan's attempts.


However, the UT administration later sounded a fresh air raid siren, appealing to people to remain indoors.


“An air warning has been received from the air force station of a possible attack. Sirens are being sounded. All are advised to remain indoors and stay away from balconies,” an official statement said.


About an hour later, the administration said the siren for the alert was over.


Similar sirens were sounded in Haryana's Panchkula and Ambala for a brief while, appealing to people to stay indoors.


The district administration in Patiala too issued an advisory, urging people to stay indoors and remain calm.


Night of fear

People in Rajasthan's border districts also recounted a night of fear and uncertainty amid sounds of loud explosions and a complete blackout.


“While we couldn't see anything, we heard loud sounds that were scary,” said a resident of Jaisalmer bordering Pakistan.


Another resident said, "After the blackout, we could not realise what was happening. Later, we found out that it was an attack by Pakistan that our armed forces thwarted.”


Amid the escalating tensions, the authorities extended the blackout in Jaisalmer till 6 am on Friday though the situation remained largely calm in the morning.


Meanwhile, a bomb-like object was found in the Kishanghat area of Jaisalmer district on Friday morning, prompting swift action by the local police and air force.


According to police, the object was found near a nursery in front of Kishanghat.


Kotwali SHO Prem Daan said it seemed to be a bomb-like object.


Advisory to residents

In Himachal Pradesh, the district administration in Bilaspur, which shares border with Punjab, issued an advisory on Friday prioritising the safety and security of citizens.


The advisory appealed to the residents to ensure a complete blackout in their respective areas to minimise risks in the event of a potential aerial attack.


On Thursday night, India thwarted Pakistan's fresh attempts to strike military sites with drones and missiles, after foiling its attempts to target military installations in 15 cities in the northern and western parts of the country.


The renewed attempts by the Pakistani forces came after the Indian armed forces on Wednesday carried out precise missile strikes on nine terror targets in Pakistan-occupied Kashmir (PoK) and Pakistan under ‘Operation Sindoor’ in retaliation for the April 22 Pahalgam terror attack.


Blackout for over seven hours

Bhuj (Gujarat): A total blackout for more than 7 hours was enforced in several parts of the border districts of Kutch and Banaskantha in Gujarat on Thursday night amid escalating tension between India and Pakistan, officials have said.


Both Kutch and Banaskantha districts share a border with Pakistan.


Officials confirmed that several parts of Kutch, including Bhuj, Nalia, Nakhatrana and Gandhidham towns, were put under total blackout as a precautionary measure to deter any offensive gesture by Pakistan.


The lights went out around 10 pm on Thursday, and power was back after 5.30 am on Friday, they said.


Complete blackout in Ambala

Ambala: The district administration in Haryana's Ambala, which is a key air force base, on Friday issued an order to enforce blackout during night hours amid the military conflict between India and Pakistan, officials said.


Use of inverter, generator and any other power backup used for outdoor lights, billboards, street lights, etc. has been banned from 8 pm to 6 am in Ambala district till further orders, the order said.

Comments

bottom of page