Systematic Withdrawal Plan (SWP) Funds
As of July 8, 2025, SWP is a crucial instrument for generating regular monthly income, especially for retirees and investors who need a steady cash flow without liquidating their investment portfolio.
Market Context and SWP Popularity
The Indian mutual fund industry is experiencing strong growth, with Assets Under Management (AUM) surpassing ₹50 lakh crore in 2025. This growth is driven by increased retail investments and systematic investment plans (SIPs).
SWP as a wealth decumulation strategy is gaining popularity, particularly among retirees. Both hybrid and debt funds are favored for their stability and predictable returns.
SEBI has introduced new guidelines on expense ratios and disclosure norms, which impact fund performance and investor returns. The current stabilizing interest rate environment makes debt funds particularly attractive to income-seeking investors.
Top 5 SWP Funds for Reliable Monthly Income
| Rank | Fund Name | Type | Equity (%) | Debt (%) | Min SIP (₹) | Launch Year | Expense Ratio (%) | NAV (₹) | AUM (₹ Cr) |
|---|---|---|---|---|---|---|---|---|---|
| 1 | ICICI Prudential Balanced Advantage Fund | Hybrid (Dynamic Asset Allocation) | 66.07 | 19.17 | 500 | 2013 | 0.85 | 82.75 | 63,787 |
| 2 | HDFC Hybrid Equity Fund | Hybrid (Multi-Asset) | 65.21 | 31.05 | 500 | 2013 | 1.04 | 130.63 | 24,461 |
| 3 | SBI Magnum Medium Duration Fund | Debt (Medium-Term) | - | 91.20 | 500 | 2003 | 1.22 | 55.60 | 6,580 |
| 4 | Axis Equity Saver Fund | Hybrid (Equity Savings) | 65.75 | 28.81 | 100 | 2015 | 2.27 | 21.95 | 946 |
| 5 | Aditya Birla Sun Life Regular Savings Fund | Hybrid (Conservative) | 19.98 | 74.35 | 100 | 2004 | 1.92 | 75.09 | 1,385 |
Detailed Fund Analysis
ICICI Prudential Balanced Advantage Fund
Why It's Appropriate
This fund dynamically adjusts exposure to equity and debt based on market conditions, balancing growth potential with stability. Ideal for SWPs seeking capital appreciation alongside regular income.
HDFC Hybrid Equity Fund
Why It's Appropriate
Balances growth and stability with equity driving upside potential while debt cushions against volatility. Excellent for investors seeking a balance between growth and income.
SBI Magnum Medium Duration Fund
Why It's Appropriate
Prioritizes steady income with minimal risk through a portfolio of government and high-quality corporate debt. Ideal when interest rates are stabilizing.
Axis Equity Saver Fund
Why It's Appropriate
Offers growth potential through equities while maintaining downside protection with a significant debt allocation. Suitable for investors comfortable with some volatility.
Aditya Birla Sun Life Regular Savings Fund
Why It's Appropriate
Heavy debt weighting ensures capital preservation and predictable payouts. Ideal for conservative investors prioritizing stable income over growth.
Key Considerations for SWP Investors
Risk vs. Return
Debt funds provide stability while hybrid funds offer growth potential with higher volatility.
Investment Horizon
SWPs work best with long-term planning (5+ years), especially for retirement income.
Tax Efficiency
Equity withdrawals (over 1 year) taxed at 10% while debt gains vary by holding period with indexation benefits.
Inflation Protection
Regularly review and adjust your monthly withdrawal to maintain purchasing power.
Expense Management
Lower expense ratios boost net income - compare TERs before choosing a fund.
Rebalancing
Periodically review your portfolio to ensure alignment with your financial goals.
