Investing in mutual funds is an efficient method to attain long-term financial objectives such as retirement planning, saving for your kid's education, marriage, or establishing a passive revenue source. However, understanding the process of mutual fund redemption is just as vital as investing in them. Redeeming mutual funds is an essential step in achieving your investing goals and should be approached with caution.
The procedure of withdrawing your investment from a mutual fund scheme is called mutual fund redemption. Depending on the investor's requirements, partial or complete redemption of a mutual fund may be done. That transaction may be valid for a number of reasons, including a sudden financial need, withdrawing profits, or rebalancing your investment portfolio.
Below is the detailed process on how to redeem mutual funds online in a jiffy.
Log in to your mutual fund account using your login credentials to redeem your mutual funds. Ensure you have the relevant information on hand, such as the name of the mutual fund scheme, the number of units to be redeemed, and so on.
After you've logged in, proceed to the 'Redeem' option under the 'Transactions' tab. Choose the mutual fund scheme you wish to redeem from the list of projects you have invested in.
Enter the amount you want to redeem after choosing the mutual fund plan. Before inputting the redemption amount, make sure to verify the investment's current value.
You have the option of redeeming through cheque, electronic transfer, or direct credit to your bank account. Select the mode that is easiest for you.
After reviewing all the details, submit your redemption request. Within a few business days after your redemption request has been approved, the money will be credited to your bank account.
The following are the details about the factors affecting mutual fund redemption time
The redemption period may vary depending on the kind of mutual fund you have invested in. Unlike closed-ended funds, open-ended mutual funds are often more liquid and have faster redemption times.
The method of redemption you select might also impact the time it takes to redeem a mutual fund. Compared to electronic redemption methods such as NEFT or RTGS, cheques or demand drafts may take longer to get the funds.
The mutual fund house's policy also influences the redemption time. Some mutual fund companies may impose a holding time before redemption, which might cause the redemption procedure to be delayed.
Redeeming mutual funds is a vital phase towards accomplishing your investing goals and should be done carefully. You may conveniently track and save your mutual fund investments using online investing platforms such as Fi Money.
Mutual Fund investments on Fi are commission-free. With its intuitive user interface, suited for novice & seasoned investors, you can select from over 900 direct Mutual Funds. Plus, Fi's 100% secure as it functions under the guidance of epiFi Wealth, a SEBI-registered investment advisor. To help simplify the steps involved, you can invest daily, weekly, or monthly via automatic payments or SIPs — created with one screen tap. Moreover, Fi offers 100% flexibility with zero penalties for missed payments.
The amount of time required to redeem a mutual fund can change based on several variables. A few notable ones are the mutual fund type, the method of redemption, the time of the redemption request, and market circumstances. However, it may usually take 1-3 working days to get the amount credited to your bank account.
Yes, you can redeem your mutual funds anytime. However, specific mutual fund companies may impose a holding term before redemption. It is a cooling-off period after acquisition, which may limit redemption to a particular time frame.
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