SWP (Systematic Withdrawal Plan) is the reverse of SIP: instead of investing a fixed amount each month, you withdraw a fixed amount from your mutual fund at regular intervals. It’s a popular way to generate retirement income from your corpus.

How SWP Works for FIRE

After reaching your FIRE number, you can set up an SWP from an equity or hybrid fund. Each month, a fixed amount is redeemed and credited to your bank account. This complements the 4% rule approach—you’re systematically drawing down your portfolio to fund expenses.

SWP vs Lump Sum Withdrawal

• SWP — Predictable monthly income; rupee-cost averaging in reverse (you sell fewer units when NAV is high, more when low)
• Lump sum — You decide when to withdraw; more flexibility but requires discipline

Many FIRE retirees use SWP from debt or hybrid funds for stable income, keeping equity for growth. Pair with asset allocation and rebalancing for a sustainable withdrawal strategy.