Excelsior Correspondent
JAMMU, July 28: ICICI Prudential has introduced ‘Freedom SWP’ feature in select/eligible open-ended schemes.
This feature allows the investor to periodically withdraw fixed amount i.e. 6% p.a. from investment corpus along with an option of Yearly Top Up of either 3%, 4% or 5%.
SWP percent is fixed at 6% per annum. However, investor has an option to choose yearly top up options i.e., either 3%, 4% or 5% per annum. In case, investor does not select the Top Up %, default Top Up option will be 3%.
With the help of Freedom SWP, investor can manage his/her future growing expenditure better and maintain his/her current lifestyle in future as well. It is a feature that helps you maintain your lifestyle today and tomorrow.
It is an innovation over the traditional SWP that we know about and allows overcoming some shortcomings of the traditional SWP since with a traditional SWP, increasing expenses are not factored into. While the expenses keep on growing due to inflation, the Cash-Flow from SWP remains constant, resulting in huge gap in Expenses v/s Cash-flow as the time progresses. Whereas in a Freedom SWP, cash flow increases to meet the increasing expenses.
This feature will be available in select/eligible open-ended schemes. Also, this feature is available only for Growth option under Direct Plan and Other than Direct Plan of the eligible schemes.
Under this feature investors will have an option to choose from eligible schemes, specify the amount, Choose Top up %, Choose SWP start date. In case, investor does not select the Top Up %, default Top Up option will be 3%.
Freedom SWP aims to provide monthly cash-flow which are growing annually, and will allow investors to live life freely without worrying about increasing expenses due to inflation. It allows investors to tackle inflation and the payouts are much more tax efficient as compared to traditional investment options.