When I sell my mutual funds, how much time does it take to get my money back?Asked
Time taken to redeem mutual funds
It takes around 1-3 working days to get money in your bank when you redeem from mutual funds.
For Liquid Funds, it takes 1 working day to get back money. There are some instant redemption schemes where you get money immediately.
For Debt Funds, it takes 2 working days.
For Equity Funds, it takes 3 working days.
Few important points
1. If you redeem before the cutoff time (usually 3pm), the nav applicable is the closing of NAV of today. Else it is NAV of the next day.
2. You cannot redeem ELSS funds before 3 years as they are locked in for 3 years.
3. Do checkout the exit load you are going to incur while redeeming. Most of the equity funds have exit load if you redeem before one year. Some debt funds also have exit load.
4. Also consider the tax you have to pay on the returns. For equity funds, redeeming before less than a year comes under short term tax gain and hence you need to pay income tax on the returns. For debt funds, it is 3 years
Process to redeem
If you are investing online on a platform like Groww, redeem is a one click process. Else you need to fill forms to redeem.