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Kshitiz Mahajan, Co-Founder at Complete Circle Consultants, and Tarun Birani, Founder and CEO of TBNG Capital Advisors, say growth plans in mutual funds, combined with systematic withdrawal plans (SWPs), remain more suitable for long-term wealth creation. They note that income distribution cum capital withdrawal (IDCW) plans cater primarily to investors in lower tax brackets who require periodic income. According to them, IDCW payouts can reduce the benefits of compounding over time and are taxed at applicable slab rates, which may weigh on overall returns compared to growth-oriented strategies.
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First Published:Â Apr 28, 2026 4:25 PM IST