Stop Worshipping Sips And Start Using Them For Goals Now

Set an amount, automate increases, ignore noise, stick to horizons, review annually.

- SUJITH C R

Wealth generation is no longer the preserve of conventional savings vehicles like fixed deposits, gold, or property for India's millions of investors. Mutual funds have become the mode of long-term investment preferred in the recent past, and among them, the Systematic Investment Plan (SIP) has acquired special significance. SIP enables investors to make regular investments in small sums, merging convenience, discipline, and compounding power to generate wealth over the long term.

The Concept of SIPs

A Systematic Investment Plan is an investment in mutual funds done regularly and in phases. Rather than investing a large amount, investors pay a fixed amount - weekly, monthly, or quarterly - into a selected mutual fund scheme. The investment happens automatically on the predetermined date, which keeps it regular and eliminates the challenge of timing the market.

This strategy is suitable for both inexperienced and seasoned investors. It allows individuals with limited disposable incomes to invest in the capital markets, and helps affluent individuals diversify their investments over time.