When people talk about Systematic Withdrawal Plans (SWP), most discussions remain theoretical. In this article, I am sharing a real, data-backed case study that I personally explained in my video — no assumptions, no simulations, only actual numbers taken from historical NAV data.
This is the journey of a real investor who invested ₹1 crore in a small cap mutual fund in November 2010, faced brutal market crashes, continued monthly withdrawals, and yet — as of 24 December 2025 — still holds a portfolio value of ₹5.02 crore, after withdrawing nearly ₹1.70 crore over the years.
Why This Case Study Matters
Most investors ask the same questions:
- What happens if the market crashes after I invest?
- Does SWP fail in volatile funds like small caps?
- How much tax will I pay?
- Does inflation eat all the returns?
Instead of opinions, this article answers everything with real numbers.
The Investment Snapshot
| Parameter | Details |
|---|---|
| Initial Investment | ₹1 Crore |
| Investment Date | 1 November 2010 |
| Fund Category | Small Cap Equity |
| Monthly SWP | ₹1,00,000 |
| SWP Start Date | 1 December 2011 |
| Total Withdrawal (till Dec 2025) | ~₹1.70 Crore |
| Current Portfolio Value | ~₹5.02 Crore |
| Investment Period | ~15 Years |
📉 Reality of Market Crashes (Sequence of Returns Risk)
This investment did not move smoothly. It faced some of the worst market events in modern history:
- 2011–2013: ~40% drawdown (₹1 crore fell to ~₹60 lakh)
- 2015–16: ~23% correction (China devaluation)
- 2020 (COVID): ~56% crash
- 2022: ~21–22% correction (Russia–Ukraine, inflation)
Despite these crashes, the investor continued SWP even during COVID, proving how dangerous — yet powerful — equity SWP can be.
This is a textbook example of Sequence of Returns Risk, where early losses feel terrifying, but long-term compounding changes everything.
Why Small Cap SWP Is Extremely Risky
Let me be very clear — this is NOT a recommendation.
Small cap funds:
- Move sharply up and down
- Can fall 50–60% during extreme events
- Require strong emotional discipline
In this case study, the investor survived because:
- The investment horizon was very long
- Withdrawals were fixed and disciplined
- The fund eventually benefited from long-term economic growth
Most investors panic and stop long before this point.
Tax Reality: The Biggest Myth
Many comments usually say:
“SWP tax will kill returns.”
That is factually wrong.
Key tax facts:
- Equity LTCG tax was zero before 2018
- Later it became 10%, and now around 12.5%
- Tax is applied only on capital gains portion, not on the full withdrawal amount
When ₹12 lakh is withdrawn annually:
- It includes principal + profit
- Effective tax impact is often ₹60,000–₹90,000, not ₹1.5 lakh+
So yes — tax exists, but it is far less damaging than most people assume.
Inflation-Adjusted Reality (6% Inflation)
Now let’s talk about the toughest question — inflation.
If we adjust everything for 6% inflation:
- Real value of the portfolio today ≈ ₹2.1 crore
- Real withdrawals still provided comfortable lifestyle support
Ask yourself honestly:
Is ₹2 crore (debt-free) enough for a healthy, dignified life in India?
For most families with controlled expenses, the answer is yes.
📥 Download the Exact Excel Sheet (Important)
If you want to see month-by-month data, NAV movements, withdrawals, and real calculations exactly as shown in my video:
👉 Download the detailed Excel sheet from Google Drive here:
This sheet includes:
- Exact NAV history
- Units calculation
- Withdrawal tracking
- Portfolio value after every crash
Ideal SWP Rules (What I Personally Believe)
Based on experience:
- SWP ideally suits hybrid funds, not pure small caps
- Withdrawal rate should ideally stay around 6–7% annually
- Small cap SWP is suitable only for ultra high-risk investors
- Bucket strategy (2-bucket / 3-bucket) works far better for stability
This case study worked — but it could have failed badly with different behaviour.
Final Thoughts (Personal Note)
This article is not meant to impress — it is meant to educate.
Yes, ₹1 crore became ₹5 crore.
Yes, ₹1.7 crore was withdrawn.
But it came with:
- Sleepless nights
- 50%+ drawdowns
- Emotional pressure very few investors can tolerate
SWP is powerful, but only when aligned with the right fund, right risk profile, and right expectations.
Need Personal Guidance?
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