Lakhs of people are investing in mutual funds through SIP. However, very few of them know when it is right to withdraw the investment made in mutual funds.
Mutual fund investors are worried due to the stock market crash. Actually, due to the market crash, the portfolios of investors are falling. Due to the fall in the NAV of mutual funds, the valuation of investors’ units is decreasing. In such a situation, the question arises that when should a mutual fund investor withdraw his money? Also, how should investors choose the right time? If you also invest in mutual funds and are looking for answers to these questions, then there is no need to take tension. We are answering all your questions.
When to withdraw money from mutual funds
Are you close to the goal?
If you are close to your financial goal and you have got strong returns, then you can consider withdrawing money. It is better to withdraw money after the goal of the fund raised for needs like education or retirement is completed. You can stay invested in low risk or fixed income medium. This reduces the risk.
Performance of the fund
The performance of the mutual fund scheme should be evaluated from time to time. During the review, if a fund is not performing well, then it can be a wise decision to exit it. You can withdraw money from a poorly performing fund and invest in a good fund.
Major changes in the fund
Many times the fund house makes major changes in its scheme. If you feel that the change made by the fund house does not meet your investment goal, then it would be better to withdraw money from that fund.
Extremely important work or emergency
If there is an extremely important work or emergency, then instead of taking a loan, it would be a better decision to withdraw money from the mutual fund. By doing this, you will not only be able to meet your financial needs easily but will also avoid getting trapped in the debt trap.
