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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)

'Destroy Pakistan completely'

  • PTI
  • May 7, 2025
  • 3 min read

Ahmedabad: A woman from Bhavnagar in Gujarat, who lost her husband and a son in the Pahalgam terror attack, on Wednesday hailed the Indian armed forces for 'Operation Sindoor', and urged the government to continue action against Pakistan till it is wiped out.


Another woman, a resident of Surat, whose husband was also killed in the attack, expressed happiness over the action and said she had complete faith in the government.


Kajalben Parmar said, "I am very proud of the air strike carried out on Pakistan. I salute the armed forces and hail Bharat Mata. I am grateful to Prime Minister Narendra Modi and very happy for the strike. Keep carrying out such attacks and wipe out Pakistan, this is my prayer to Modi saheb."


Her husband Yatish Parmar and their son Smit were among the 26 persons killed in the horrific terror attack in Pahalgam. The father-son duo was among three persons from Gujarat who lost their lives in the April 22 attack.


"My son was in Class 12. He used to tell me frequently that he wanted to join the Indian Army and fight for the country. But before that, we went to Kashmir to attend Morari Bapu's 'Ram Katha' and visit Pahalgam, where they (terrorists) killed my son and husband. I want to see Pakistan annihilated," she added.


Kajalben's elder son, Abhishek Parmar said he was happy for the action against Pakistan which came on the 15th day of the Pahalgam terrorist attack.


"PM Modi took action against Pakistan on the 15th day. I lost my father and my brother, who wanted to join the army. Now that Modi has given them a reply, I am happy about that," he said.


Shitalben Kalathiya, wife of late Shailesh Kalathiya, told the media that she was "very satisfied" with India's action against Pakistan.


"I am very happy with whatever the Modi government has done to bring to justice the people who came forward and shot my husband and others in the name of Hindus and Muslims. We have full faith in the government, and whatever it has done till now is proper. We have full faith that it will do whatever is right in the future as well," she said in Surat.


The terrorists took away the only earning member of the family, she said, adding that their daughter was yet to come to terms with what happened to her father in front of her eyes.


"We were devastated. We appeal to the Gujarat government to do whatever it can for the future and education of our children. I am very happy for the action against Pakistan," she said.


Strikes have avenged son's killing: Ponywalla’s father

Anantnag (J-K): Father of Syed Adil Hussain Shah, the ponywalla who sacrificed his life while protecting the tourists during the Pahlalgam terror attack, said on Wednesday that the military strikes on terror camps in Pakistan and Pakistan-Occupied Jammu and Kashmir have avenged his son's killing.


Shah's family expressed gratitude to Prime Minister Narendra Modi and the armed forces for the retaliatory action.


"I am very happy today that the forces and (PM Narendra) Modi have avenged the killing of 26 persons. It makes me happy that those (victims) will rest in peace today," Shah's father, Syed Haider Shah, told PTI videos here.


Shah's brother, Syed Nawshad, said the prime minister has delivered his family and the families of the other 25 victims justice.


"Now, my brother, and 25 other innocents will rest in peace. When I came to know this morning that Modi has avenged the killings, it made me happy. We have got justice now, and we are very happy," Nawshad said.

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