14 May 2018
After 2018 finance budget, it makes more sense to invest in growth option. This is because, tax deferment is considered to be better than paying upfront tax. If the clients want regular income through dividends, SWP option could be used effectively. Also, for IFAs, it helps in reducing the erosion of AUM due to dividend payout option. Dividend re-investment option now doesn’t make sense except for very specific client to client requirement. For existing investments in equity funds which are in dividend option, you can consider to move them in growth option after units have become long term (LTCG). SIPs in dividend option can be immediately stopped and restarted in growth option.