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Top-5 Reasons Why SIP Investment is Best!08 October 2020

An SIP or a Systematic Investment Plan is an intelligent financial vehicle that allows you to invest in mutual funds easily and without any trouble. One invests a small amount of money every month with a well planned systematic approach. It allows one to develop a healthy habit of building wealth and disciplined financial saving for their future. Investing in SIP not only provides you with higher returns but also a better investment avenue. Here we will be discussing the reasons to invest in SIPs. However prior to investing, SIP calculations should be done to achieve your targets.

Regular and disciplined Investing habit

The best thing about investing in SIP is that it allows you to invest money as low as Rs 500 to 1000 per month. So you don’t have to stress all the time worrying about the monthly deposit. There is no financial burden on your bank accounts and it also helps you develop a healthy habit of regular investment on a monthly basis.

Achieving your financial targets

Making disciplined monthly investments over a period of time in SIP helps you to accomplish your financial goals. It effortlessly helps in making your life long dreams like buying a home, children` s education,  retirement planning come true.

Another  advantage of investing in SIP is that, there is no lock-in period. You can withdraw your complete amount from SIP if and when you require.

Power of Compounding at its best

Being an ideal choice for a young investor, investing small amounts like Rs 500 to 1000 per month over a long period of time accumulates to a huge wealth later. Making regular investments for a long time, gives you the benefit of compounding guaranteeing higher returns.

Risk of equity market is minimised

Equity markets are volatile with frequent ups and downs, however investing in SIPs allows you to breeze through them without any problem. Investment amount buys fewer shares when the market is going up and and more shares when it goes down. There is no need to time the market as you minimise the risk of market stock volatility by making long term investments.

Always diversify

According to experts a good investor, invests across eight to ten sectors. A good investment strategy is always well diversified. Investing in SIP allows you to benefit from diversification that spreads out the risk and yields higher returns at the same time.

 

Conclusion

 

SIP investment plans allows to create wealth by regular investments in mutual funds over a period of time. It yields inflation adjusted returns with minimal risks involved. To fulfill your financial goals you just have to choose the right type of mutual funds for yourself. It is very convenient and hassle-free. All you have to do is register yourself for an SIP account and start investing with just a click.