What is SWP in Debt Mutual Funds?
Introduction
A systematic withdrawal plan, or SWP, is the systematic way through which an investor withdraws money periodically from his mutual fund investment. SWPs are very popular among those people who wish to generate a regular source of income especially among retired or any individual with fixed financial needs. SWP is available in a very wide range of categories of mutual fund, most preferred by investors for low risk, as compared to equity funds.
Most of the investment in debt mutual funds is into fixed income instruments that include government securities, corporate debt, and other money market products. Combined with the systematic withdrawing mechanism of SWP, it becomes a fine solution to earning regular incomes in a risk-free fashion while capital erosion is also minimal.
Understand SWP in Debt Mutual Funds

SWP allows investors to withdraw a fixed or variable amount from their mutual fund investment at regular intervals. Instead of redeeming the entire investment at once, SWP enables partial redemptions while keeping the rest of the investment active and growing.
This approach is apt for debt mutual funds as the primary goal of investment in them is stability and income generation. The withdrawal can be structured as per the needs of an investor, such as a monthly requirement or periodic lump sum.

1. Types of SWP in Debt Mutual Funds

Fixed Amount SWP
In this type, investors withdraw a predefined fixed sum at regular intervals. The proceeds keep on being withdrawn up to depletion of corpus or on termination of the plan by the investor.
Example: ₹10,000 SWP every month for a debt fund investment.

Appreciation SWP
Only the appreciation on the investment is withdrawn. The corpus remains intact; hence, suitable for conservative investors.
Example: A fund has gained ₹2,000 in a month. Only this amount is withdrawn.

Customized SWP
Investors can customize their SWPs based on specific needs- different amounts at different