Showing posts with label 9 Genuine Reasons to Begin SIP: By Urvashi Arya. Show all posts
Showing posts with label 9 Genuine Reasons to Begin SIP: By Urvashi Arya. Show all posts

9 Genuine Reasons to Begin SIP: By Urvashi Arya

 9 Genuine Reasons to Begin SIP:

By Urvashi Arya 

When it comes to starting from scratch in mutual fund investments, the SIP, or Systematic Investment Plan, has shown to be a solid and popular option.

Everyone advocates starting SIPs, whether you're a novice or a seasoned investor, because it's the most efficient approach to investing in mutual funds.

This article will provide you with nine compelling reasons to begin a systematic investment plan (SIP) to get the most out of your mutual fund scheme.

Develops Your Investing Discipline – (All Reasons will be H2)

The first important reason to start a SIP is that it teaches you to be a disciplined investor. Unfortunately, several investors start their trading journey, but as time passes by, their investing fails drastically because of a lack of regular investments.

Regular investments are critical in assisting you in achieving your financial objectives. SIP's design and capabilities allow it to add discipline to your financial journey.

You won't have to make a prefixed monthly contribution whole on your own since an amount you specify will be automatically invested in your chosen scheme.

Lessens Mutual Fund per average unit Cost upon:

SIP assists you in lessening the average cost of mutual fund units at the time of purchase. When the market falls bluntly, the net asset value (NAV) rises, and when the market increases, the NAV touches the sky.

So, in the long run of time, when you invest a fixed amount with the help of SIP, the average cost of all these units remains cheaper than when you invest in a lump sum when markets are rising.

Investment is quite low:

An investor can begin investing using SIPs because the minimum investment required to begin a SIP is only RS 500 each month.

This investment amount is far lower and better for millennials than numerous other mutual fund plans.

If you're in your twenties or have recently begun working, a SIP will be an excellent way to begin your investing path toward your financial goals.

Financial objectives

It is left totally at your discretion to an investor on SIPs you want.

Investors should consider SIPs as an excellent strategy for mutual funds because they are quite adaptable.

Consider the following scenario:

There is no requirement that you invest Rs 500 every month in a SIP mutual fund scheme of your choice if you want to start by investing Rs 500 in a SIP mutual fund within the scheme of your choice and preference.

You can increase your SIP amount or start a new one if you have more inflow of money or expect to have more savings in the future.

You can increase the amount you pay each month, which is one of the key benefits of starting a SIP.

By automating the process, you can save money every month. You can ensure that you save every month by starting a SIP. If you invest a predefined and decided amount each month according to your preferences, you will save a small amount and gain financial discipline.

You can even choose your SIP date once your salary has been deposited into your account by your employer. Saving money this way will help you avoid spending it when you need it most.

You Don't Have to Be Concerned and constantly worried About Market Volatility and unpredicted market movements:

You don't have to be concerned or pay attention to missed SIP possibilities or entry deadlines. Furthermore, because you invest a predetermined amount every month, it provides for "averaging."

When markets are trading at a high or a larger level, fewer known units of the fund will be added accordingly to your portfolio, but when markets are low, many units will be added. It will assist you in achieving the ideal required balance.

You'll be able to adhere to your long-term SIP plan without being distracted by market volatility.

SIP can be paused for a limited time or missed:

You can ask for termination or skip paying your SIP, which means an investor is not obligated to invest their hard-earned money every month for a set period.

If you cannot continue with the SIP, you can have the option to skip or stop the investment.

You can skip making payments for SIP sometimes for a few months in case you are in the middle of a significant emergency, don't have enough money for treatment, or have another problem.

Completely secure and safe:

Mutual funds are continuously growing in India as more people begin to invest in the hope of making a profit.

Securities and Exchange Board of India (SEBI) and the Association of Mutual Funds in India (AMFI) have taken various severe steps to protect the returns and interests of all investors, and every mutual fund scheme and asset management company (AMC) must follow these policies.

This has made the mutual fund sector the safest and sound for investors who have just begun investing in SIPs or who are just considering doing so.

SIPs do not include time markets:

It is difficult to the core to regulate the time of the market when you are an investor. SIPs, on the other scenario, have no foundation of any market timing for investments.

All that needs to be done by an investor is to invest their predetermined and prefixed amount around the same time of the month, regardless of any market conditions or scenarios. However, if the market is showing a downward trend, you will receive more amount of dollars, and if the market is on an upward in trend, you will receive fewer units.


Is it true that a systematic investment plan (SIP) might help you save money when purchasing mutual fund units?

SIP assists in reducing the average cost of mutual fund units at the time of purchase. When the market falls sharply and bluntly, the net asset value (NAV) plummets, and when the market rises, the NAV skyrockets.

Is it true that starting a SIP will help me save money every month?

Starting a SIP will assist you in the right manner, ensuring that you save the required each month. You will save a small amount of money which will add financial discipline to your financial career if you invest a required and defined amount each month according to your preferences.

Does starting a SIP will make you a disciplined investor?

Starting a SIP will give you the required assistance in ensuring that you save each month. You will save a small amount of money and add financial discipline to save within your financial career. 

Urvashi Arya   

Urvashi Arya - Content Writer - Vantage ITeS Consulting | LinkedIn

9 Genuine Reasons to Begin SIP:

By Urvashi Arya