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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)

Mosques, madrassas open for displaced border residents

  • PTI
  • May 8, 2025
  • 3 min read
Locals from different areas along the India-Pakistan border being brought to a temporary camp at Mishriwala area in Jammu district on Thursday. Pic: PTI
Locals from different areas along the India-Pakistan border being brought to a temporary camp at Mishriwala area in Jammu district on Thursday. Pic: PTI

Jammu: The doors of all mosques and madrassas in the Jammu region are open for the displaced border residents, prominent Muslim scholar Mufti Sageer Ahmad said on Thursday, as he joined dozens of youngsters to donate blood for the victims of Pakistani shelling here.


The blood donation camp was organised by the Madrassa Markaz-ul-Maarif at Bathindi, near here, following an appeal by social activists after intense Pakistani shelling in Poonch district on Wednesday left 13 people dead and 44 injured.


"We have set up this camp in view of the tense situation on the borders so that there is no shortage of blood in our hospitals.... Islam teaches us that saving one life is like saving the entire humanity," Ahmad, who is also the head of the institute, said.


He said the country and its people need them at this crucial juncture and they have come forward to donate blood for those injured on the borders.

"We have kept our madrassas (Islamic seminaries) and masjids ready for the border residents if they are to be relocated. It is the teachings of Islam and we are adhering to it. If we can save a human life, we are saving the humanity," Ahmad said.


Blood donation

He said both teachers and students are voluntarily donating blood and more than 50 units have so far been collected which will be deposited in the blood bank of the Government Medical College (GMC) hospital in Jammu.


"We are ready to extend our support to people irrespective of their religion. We are there to cooperate with anyone, whether it is someone from the administration or from the public," he said.


Many mosques and madrassas across the Jammu region are affiliated with the Markaz.


Volunteers and political activists organised blood-donation camps at different places over the past two days, while the Jammu High Court Bar Association is also planning to hold such an event in the district court complex here on Friday.


"In this current time of conflict, understanding its responsibility towards humanity, the association is organising a blood-donation camp to meet the shortage of blood in the blood banks at Jammu," the lawyers' body said, requesting members to come forward and voluntarily donate blood.


Meanwhile, the Jamia Zia-ul-Islam, an educational institute, is providing accommodation to about 50 people, mostly border residents who were evacuated amid intense cross-border shelling the previous day.


"The Jamia Zia-ul-Islam stands by the people of the country in this difficult situation. If any person living on the border needs any help, the institution is there to help," its spokesperson said.


Maulana Iqbal not terrorist: Police

Jammu: Maulana Iqbal was not a terrorist but a respected religious figure who lost his life along with 12 others in heavy Pakistani shelling in Jammu and Kashmir's Poonch district, police said on Thursday.


The Jammu and Kashmir Police came out with a clarification on the 45-year-old Iqbal after certain media outlets and social media platforms circulated "baseless and misleading" reports, claiming that he was a top terrorist and was killed in a missile strike by Indian armed forces across the border.


"Any media outlet, journalist, or individual found indulging in the circulation of such fake news shall be liable for legal action as warranted under relevant provisions of law," police said in a statement.


Iqbal, a resident of Baila village in Mandi tehsil, was killed when a mortar shell hit his Madrasa Zia-ul-Uloom in Poonch city on Wednesday. A gurdwara and a temple were also hit by the indiscriminate Pakistani shelling in the district, claiming 13 lives, including that of a soldier, four children and two women.

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