How To Withdraw Money From Mutual Funds


4 min read

Gone are the days when people would only believe in saving. These days, along with saving people also focus on investing their hard-earned money. And as we talk of money investments, mutual fund tops the list. Mutual fund options are so many these days and so are the numbers of people who want to put their money into it.

Nevertheless, many people are still confused about the idea of mutual funds and wonder if they can withdraw money from them. Well, one of the best things about mutual funds is that it is a liquid investment. This means you will be able to withdraw money from mutual funds whenever you want. However, some mutual funds have a lock-in period.  One of those schemes is the Equity Linked Savings Scheme (ELSS), which comes with a 3-year maturity period. Once the lock-in period is completed, you will have the choice of either partial or total mutual fund redemption or you have the mutual fund for a long time. So, let us talk about the ways to get money out of a mutual fund scheme.

Also Read: Difference Between Unit-Linked Insurance Policy (ULIP) and Mutual Funds

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Withdraw money from mutual funds – Know how

As we start talking about withdrawing money from a mutual fund plan, we should know that it is a straightforward process. The money can be redeemed in various ways.

With the help of a distributor or a broker

You will be able to withdraw funds from a mutual fund scheme by taking the help of a broker or a distributor, especially if you had invested through them. You can get in touch with your broker or distributor and request a withdrawal. To get started with the process, you need to get a withdrawal request form, if you want to proceed with the withdrawal process offline. You must duly fill out the form and submit it. The form will be received by the Asset Management Company from the broker or the distributor. On the other hand, some brokers offer an online service through a web portal or mobile application. So, you can choose the online mutual fund redemption as well. You will be able to very easily log into your mutual fund account, choose the withdrawal option, enter the units that you want to withdraw, and in real-time, your request will be completed.

With the help of the Asset Management Company

Mutual funds can be redeemed directly through the Asset Management Company (AMC) as well. You will have the option to visit the branch office of an Asset Management Company and also submit an offline withdrawal request. You will also have the option to carry the process online. You can visit the official website of AMC or install the mobile application on your phone for redemption.

With the Help of the Registrar and Transfer Agents  

Registrar and Transfer Agents help in investing in mutual funds schemes and also withdrawing money from them. You would be required to submit either an online or offline withdrawal request to the Registrar and Transfer Agents and accordingly withdraw your required amount of money.

With the help of your Demat and Trading Account

If you used a Demat and trading account in order to invest in mutual fund plans, you will also be able to withdraw from this account. If you want to check your mutual fund investment, you would be required to go into your account, select the amount of money that you want to withdraw, and then accordingly submit your request. The redemption is handled and the money is credited to your associated bank account once the request is validated.

If you are in urgent need of money, your mutual fund amount can be used for a speedy supply of money. One of the biggest benefits of mutual fund investment is that you will be able to redeem the money in unit or money terms, and you will have to option to do so either partially or totally. In this sense, we can say that mutual fund investments come with enough flexibility, especially when we talk about redemption. Nevertheless, the only thing you need to consider while redeeming the funds from your mutual fund units is the exit load as well as tax implications.

To check out the options of mutual funds, you can explore them online. There are many such options and you can choose the one that suits your needs.

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Also Read: How to Save Tax With Unit Linked Insurance Policies (ULIP)

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May 19, 2022
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PayBima is an Indian insurance aggregator on a mission to make insurance simple for people. PayBima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. PayBima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.

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