{"id":5725,"date":"2024-07-23T18:41:59","date_gmt":"2024-07-23T13:11:59","guid":{"rendered":"https:\/\/www.gettogetherfinance.com\/blog\/?p=5725"},"modified":"2026-01-02T14:46:43","modified_gmt":"2026-01-02T09:16:43","slug":"systematic-investment-plan","status":"publish","type":"post","link":"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/","title":{"rendered":"Systematic Investment Plans: Benefits, Strategies and SIP Plans to Invest"},"content":{"rendered":"\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"597\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Systematic-Investment-Plan-SIP-Your-Steady-Investment-Path-1-1-1767340295-gXHK-1024x597.webp\" alt=\"Systematic Investment Plans: Benefits, Strategies and SIP Plans to Invest\" class=\"wp-image-10909\" srcset=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Systematic-Investment-Plan-SIP-Your-Steady-Investment-Path-1-1-1767340295-gXHK-1024x597.webp 1024w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Systematic-Investment-Plan-SIP-Your-Steady-Investment-Path-1-1-1767340295-gXHK-300x175.webp 300w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Systematic-Investment-Plan-SIP-Your-Steady-Investment-Path-1-1-1767340295-gXHK-768x448.webp 768w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Systematic-Investment-Plan-SIP-Your-Steady-Investment-Path-1-1-1767340295-gXHK.webp 1200w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p><strong><em>\u201cInvesting should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas.\u201d \u2013 Paul Samuelson.<\/em><\/strong> <\/p>\n\n\n\n<p>A Systematic Investment Plan (SIP) very well follows the essence of this amazing quote. SIPs offer a steady and disciplined approach to investing allowing investors to invest a fixed amount consistently into <a href=\"https:\/\/www.gettogetherfinance.com\/blog\/how-mutual-fund-work\/\">mutual funds<\/a>, leveraging the power of compounding and consistent investing over time.\u00a0<\/p>\n\n\n\n<p>It\u2019s opposite to the one-time investment approaches, SIPs encourage regular monthly savings. Systematic Investment Plans make it easier to achieve financial goals without the pressure of selecting stocks and market timing.\u00a0<\/p>\n\n\n\n<p>Ever since SIPs have become popular and accessible among both novice and seasoned investors, it has helped them build wealth. With the help of this blog, dive into the world of SIPs and discover how small, regular investments can lead to significant financial growth.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_78 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#What_is_SIP\" >What is SIP?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#How_SIPs_Systematic_Investment_Plans_Work\" >How SIPs (Systematic Investment Plans) Work?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#The_Mechanism_of_Systematic_Investment_Plan\" >The Mechanism of Systematic Investment Plan<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#How_SIPs_are_Different_from_Lump_Sum_Investments\" >How SIPs are Different from Lump Sum Investments?<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Step%E2%80%91Up_Flexible_Trigger_SIPs_Advanced_Variations\" >Step\u2011Up \/Flexible \/Trigger SIPs: Advanced Variations<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Benefits_of_Investing_in_SIP\" >Benefits of Investing in SIP<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Tax_Regulatory_Aspects_of_SIPs_in_India\" >Tax &#038; Regulatory Aspects of SIPs in India<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#How_to_Use_an_SIP_CalculatorGoal_Planner\" >How to Use an SIP Calculator\/Goal Planner<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#SIPs_and_Inflation_Real_vs_Nominal_Returns\" >SIPs and Inflation: Real vs Nominal Returns<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Strategies_for_Successful_SIP_Investing\" >Strategies for Successful SIP Investing<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#SIP_vs_Other_Investment_Vehicles\" >SIP vs Other Investment Vehicles<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Top_Mutual_Funds_to_Do_SIP_Systematic_Investment_Plan\" >Top Mutual Funds to Do SIP (Systematic Investment Plan)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Things_to_Consider_Before_Starting_SIP\" >Things to Consider Before Starting SIP<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#When_to_Review_or_Rebalance_a_Systematic_Investment_Plan_Portfolio\" >When to Review or Rebalance a Systematic Investment Plan Portfolio<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Common_Mistakes_Investors_Make_with_SIPs_in_India\" >Common Mistakes Investors Make with SIPs in India<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Conclusion\" >Conclusion\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Frequently_Asked_Questions\" >Frequently Asked Questions<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-18\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#What_is_the_minimum_amount_required_to_start_a_SIP\" >What is the minimum amount required to start a SIP?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-19\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Can_I_change_the_investment_amount_or_frequency_in_my_SIP\" >Can I change the investment amount or frequency in my SIP?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-20\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Are_SIPs_suitable_for_both_short-term_and_long-term_financial_goals\" >Are SIPs suitable for both short-term and long-term financial goals?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-21\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#What_happens_if_I_miss_a_SIP_installment\" >What happens if I miss a SIP installment?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-22\" href=\"https:\/\/www.gettogetherfinance.com\/blog\/systematic-investment-plan\/#Are_returns_from_SIPs_guaranteed\" >Are returns from SIPs guaranteed?<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_SIP\"><\/span>What is SIP?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"207\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-2-1024x207.webp\" alt=\"What is SIP?\" class=\"wp-image-10679\" srcset=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-2-1024x207.webp 1024w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-2-300x61.webp 300w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-2-768x155.webp 768w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-2.webp 1201w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>SIP, or <strong>Systematic Investment Plan<\/strong>, is a method of investing a fixed amount regularly in mutual funds, typically monthly. It allows investors to build wealth over time by averaging out the cost of investment (rupee cost averaging) and benefiting from the power of compounding. SIPs are ideal for long-term goals and help instill financial discipline without the need to time the market.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_SIPs_Systematic_Investment_Plans_Work\"><\/span>How SIPs (Systematic Investment Plans) Work?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/How-SIPs-Systematic-Investment-Plans-Work-1024x276.webp\" alt=\"How SIPs (Systematic Investment Plans) Work\" class=\"wp-image-5729\"\/><\/figure>\n\n\n\n<p>Systematic investment plans or SIPs allow investors to put a fixed amount of money monthly in <a href=\"https:\/\/www.gettogetherfinance.com\/blog\/how-mutual-fund-work\/\" target=\"_blank\" rel=\"noreferrer noopener\">mutual funds<\/a>. It is simply like an installment for your savings. People can do it for various goals, as time passes and the holdings of mutual funds grow, the money invested in it grows.\u00a0<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"The_Mechanism_of_Systematic_Investment_Plan\"><\/span>The Mechanism of Systematic Investment Plan<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>SIP is a method with which investors can invest their money in mutual funds in the form of installments at regular intervals. Here\u2019s how SIP works :<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Choose a Mutual Fund<\/strong>: The first step in doing an SIP is to find a good mutual fund that has good NAV and diverse holdings\u00a0<\/li>\n\n\n\n<li><strong>Set Investment Amount and Frequency<\/strong>: Next, select the amount you want to invest in SIP at regular intervals.\u00a0<\/li>\n\n\n\n<li><strong>Automated Investments<\/strong>: Now the amount you chose for the SIP can be deducted with the help of auto pay from your account at a fixed date of every month that you can choose by yourself. Further, it is invested in your chosen mutual funds, making it a hassle-free process.<\/li>\n<\/ol>\n\n\n\n<p><strong>Purchase of Units<\/strong>: With each investment in a mutual fund, you buy a certain unit of its, based on current <a href=\"https:\/\/www.gettogetherfinance.com\/blog\/net-asset-value\/\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/www.gettogetherfinance.com\/blog\/net-asset-value\/\" rel=\"noreferrer noopener\">Net Asset Value<\/a> (NAV). over time your investment value increases based on the increase in NAV, over the times these units accumulate<\/p>\n\n\n\n<p><strong>Types of Systematic Investment Plans<\/strong><\/p>\n\n\n\n<p>There are different types of SIPs to cater to various investment needs:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Fixed SIP<\/strong>: It is the most common type of SIP, a fixed amount is invested at regular intervals, mostly monthly.<\/li>\n\n\n\n<li><strong>Flexible SIP<\/strong>: Allows the investor to change the investment amount based on their preference.<\/li>\n\n\n\n<li><strong>Top-up SIP<\/strong>: Invest can increase the investment amount periodically, helping them invest more with time as income grows.<\/li>\n\n\n\n<li><strong>Perpetual SIP<\/strong>: One of the best things about SIPs is that they continue indefinitely until you decide to stop it, ensuring <a href=\"https:\/\/www.gettogetherfinance.com\/blog\/benefits-of-holding-stocks\/\" target=\"_blank\" rel=\"noreferrer noopener\">long-term investing<\/a> without a fixed end date.<\/li>\n<\/ol>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_SIPs_are_Different_from_Lump_Sum_Investments\"><\/span>How SIPs are Different from Lump Sum Investments?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"206\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-13-1-1767340334-lZaj-1024x206.webp\" alt=\"How SIPs are Different from Lump Sum Investments?\" class=\"wp-image-10910\" srcset=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-13-1-1767340334-lZaj-1024x206.webp 1024w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-13-1-1767340334-lZaj-300x60.webp 300w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-13-1-1767340334-lZaj-768x155.webp 768w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-13-1-1767340334-lZaj.webp 1201w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>SIPs and Lump Sum (one-time) investments are done in the same securities yet are different investment approaches. This is what makes them different:\u00a0<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Investment Timing<\/strong>:\n<ul class=\"wp-block-list\">\n<li><strong>SIP<\/strong>: Allows you to invest regularly regardless of market conditions, giving you the leverage of compounding and average costing.\u00a0<\/li>\n\n\n\n<li><strong>Lump Sum<\/strong>: You have to invest a large sum of money at once, with no leverage of averaging, which turns tables in adverse market conditions.\u00a0<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Financial Discipline<\/strong>:\n<ul class=\"wp-block-list\">\n<li><strong>SIP<\/strong>: It encourages regular savings and investing habits, making it easier to build wealth.<\/li>\n\n\n\n<li><strong>Lump Sum<\/strong>: It requires a substantial amount of money at a time, which may not be possible for every investor.\u00a0\u00a0<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Market Impact<\/strong>:\n<ul class=\"wp-block-list\">\n<li><strong>SIP<\/strong>: It mitigates the risk of market adversities by spreading the risk of investment over time.\u00a0<\/li>\n\n\n\n<li><strong>Lump Sum<\/strong>: Exposes the entire investment amount to market conditions at once, potentially leading to greater fluctuations in both upside and downside.\u00a0<\/li>\n<\/ul>\n<\/li>\n<\/ol>\n\n\n\n<p>Overall, the SIP investment provides a discipline and stress free approach to the investor for investing money. It is a good solution for people wishing to consistently put some amount of money in their investment account or portfolio.<\/p>\n\n\n\n<p><strong>Also Read<\/strong>: <a href=\"https:\/\/www.gettogetherfinance.com\/blog\/investment-management\/\" target=\"_blank\" rel=\"noreferrer noopener\">Investment Management<\/a><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Step%E2%80%91Up_Flexible_Trigger_SIPs_Advanced_Variations\"><\/span>Step\u2011Up \/Flexible \/Trigger SIPs: Advanced Variations<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"206\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-4-1024x206.webp\" alt=\"Step\u2011Up \/Flexible \/Trigger SIPs: Advanced Variations\" class=\"wp-image-10680\" srcset=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-4-1024x206.webp 1024w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-4-300x60.webp 300w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-4-768x155.webp 768w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-4.webp 1201w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>All these are advanced versions of regular systematic investment plans that give more customisation and control.<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Step\u2011Up SIP<\/strong><\/li>\n<\/ol>\n\n\n\n<p>The investment amount goes up at fixed intervals, which assist you to invest more in growing income.<\/p>\n\n\n\n<ol start=\"2\" class=\"wp-block-list\">\n<li><strong>Flexible SIP<\/strong><\/li>\n<\/ol>\n\n\n\n<p>You can increase or decrease your monthly contribution as per cash availability.<\/p>\n\n\n\n<ol start=\"3\" class=\"wp-block-list\">\n<li><strong>Trigger SIP<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Your SIP adjusts on the basis of particular triggers. For instance, if the market falls below the set limit, then NAV touches the fixed level of your portfolio and moves beyond a certain boundary.<\/p>\n\n\n\n<p><strong>Pro Tip-<\/strong> Use 2-4 funds (Flexi Cap, Large Cap, Hybrid, etc) to lower risk<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Benefits_of_Investing_in_SIP\"><\/span>Benefits of Investing in SIP<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Benefits-of-Investing-in-SIP-1024x276.webp\" alt=\"Benefits of Investing in SIP\" class=\"wp-image-5730\"\/><\/figure>\n\n\n\n<p>Investing in SIP comes with numerous benefits, let\u2019s take a look at it:\u00a0<\/p>\n\n\n\n<p><strong>Rupee Cost Averaging<\/strong><\/p>\n\n\n\n<p>SIP helps in rupee cost averaging. This is because it comes with a regular investing approach in every market condition which eventually helps in fighting market <a href=\"https:\/\/www.gettogetherfinance.com\/blog\/volatility-index\/\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/www.gettogetherfinance.com\/blog\/volatility-index\/\" rel=\"noreferrer noopener\">volatility<\/a>. When investors invest a fixed or certain amount via SIP regularly, more units of the fund are bought when the market is low and fewer units are bought when the market is high. This automatically gives the investor the average out approach which reduces the impact of sudden market falls. It makes the portfolio that is very well, managed in terms of risk.<\/p>\n\n\n\n<p><strong>Power of Compounding<\/strong><\/p>\n\n\n\n<p>The power of compounding is absolutely amazing in terms of long-term investing via SIP. In SIP, the returns are on the investment that you get automatically reinvested to the fund, which eventually increases the capital amount and the earnings on it. The cycle of reinvesting the capital with actual investment and returns results in exponential growth. The earlier a person starts investing in SIP, the more they start to benefit in terms of compounding which helps in boosting their wealth and returns as the time passes.<\/p>\n\n\n\n<p><strong>Financial Discipline and Regular Savings<\/strong><\/p>\n\n\n\n<p>SIP gives you a chance to do regular savings, instilling a sense of disciplined saving and investment habits. SIP allows a person to put aside or save a fixed amount of money every month. This helps them in regular savings without giving a burden to them. This discipline and systematic approach eventually makes it very easy to achieve financial goals without the need for a large one time investment.<\/p>\n\n\n\n<p><strong>Flexibility and Convenience<\/strong><\/p>\n\n\n\n<p>One of the best things about SIPs is that they offer convenience and flexibility in investing. Its leverage of starting it with a small amount makes it accessible to every willing investor. Additionally, one can increase or decrease the amount at their convenience, pause, or stop the SIP as per their financial situation. SIP allows the auto pay process for deduction of money. Every month, this process is the investment and saves the time and effort of the investors.<\/p>\n\n\n\n<p>Overall, Systematic Investment Plans offer a systematic, disciplined, and simple means to accumulate money over time, making them a popular choice among investors.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Tax_Regulatory_Aspects_of_SIPs_in_India\"><\/span><strong>Tax &#038; Regulatory Aspects of SIPs in India<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"206\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-6-1024x206.webp\" alt=\"Tax & Regulatory Aspects of SIPs in India\" class=\"wp-image-10758\" srcset=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-6-1024x206.webp 1024w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-6-300x60.webp 300w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-6-768x155.webp 768w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-6.webp 1201w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>Here is a systematic explanation of the Tax & Regulatory Aspects of SIPs in India:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Taxation for Equity Mutual Fund SIPs<\/strong><\/li>\n<\/ol>\n\n\n\n<p><strong>Short Term Capital Gains (STCG):<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>If units are sold in a year, then returns are considered short-term.<\/li>\n\n\n\n<li>The tax rate is 20% for listed equity, whereas STCG on mutual funds is 15%, relying on the latest rules.<\/li>\n<\/ul>\n\n\n\n<p><strong>Long Term Capital Gains (LTCG):<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>If units are sold after a year, then returns are long-term.<\/li>\n\n\n\n<li>First Rs1.25 lakh of LTCG within a financial year is tax-free.<\/li>\n\n\n\n<li>Returns above this are taxed at 12.5%.<\/li>\n<\/ul>\n\n\n\n<ol start=\"2\" class=\"wp-block-list\">\n<li><strong>ELSS (Tax Saving SIPs)<\/strong><\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Each systematic investment plan contributing to an Equity Linked Saving Scheme (ELSS) is locked for 3 years.<\/li>\n\n\n\n<li>You are not allowed to redeem it for 36 months.<\/li>\n\n\n\n<li>Few funds charge an exit load (mainly 1%) if withdrawn within a specified time.<\/li>\n<\/ul>\n\n\n\n<ol start=\"3\" class=\"wp-block-list\">\n<li><strong>Taxation for Debt Mutual Fund<\/strong><\/li>\n<\/ol>\n\n\n\n<p>       All returns, whether long-term or short-term, are taxed as per the income tax slab.<\/p>\n\n\n\n<ol start=\"4\" class=\"wp-block-list\">\n<li><strong>SIP is just a Payment Method, not a Different Product<\/strong><\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Whether you invest in a lump sum or systematic investment plan, the tax treatment remains the same.<\/li>\n\n\n\n<li>The tax results rely on the gain classification, holding period, and type of fund-not on investment mode.<\/li>\n<\/ul>\n\n\n\n<ol start=\"5\" class=\"wp-block-list\">\n<li><strong>Each SIP Installment has its Own Holding Period.<\/strong><\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Each systematic investment plan is considered a new investment, which means every investment has its own holding period.\u00a0<\/li>\n\n\n\n<li>12 months for the equity period and 36 months for debt funds to decide LTCG or STCG.<\/li>\n<\/ul>\n\n\n\n<ol start=\"6\" class=\"wp-block-list\">\n<li><strong>KYC and Compliance Need<\/strong><\/li>\n<\/ol>\n\n\n\n<p>       To invest in SIP, you have to complete:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>PAN linking<\/li>\n\n\n\n<li>FTCA declaration<\/li>\n\n\n\n<li>KYC verification<\/li>\n\n\n\n<li>Bank mandate (auto-debit)<\/li>\n<\/ul>\n\n\n\n<ol start=\"7\" class=\"wp-block-list\">\n<li><strong>Capital Loss Set-Off Rules Apply to SIPs<\/strong><\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>LTCL- can offset only LTCG<\/li>\n\n\n\n<li>STCL- can offset both LTCG and STCG<\/li>\n<\/ul>\n\n\n\n<ol start=\"8\" class=\"wp-block-list\">\n<li><strong>Switches are Treated as Redemption<\/strong><\/li>\n<\/ol>\n\n\n\n<p>If you switch:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>From growth to EDCW<\/li>\n\n\n\n<li>From regular to direct plan<\/li>\n\n\n\n<li>From one fund to another<\/li>\n<\/ul>\n\n\n\n<ol start=\"9\" class=\"wp-block-list\">\n<li><strong>Dividend Taxation<\/strong><\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Any dividend you receive from a mutual fund is considered part of your total income and taxed according to your slab.<\/li>\n\n\n\n<li>If your yearly dividend from a mutual fund goes above Rs 5000, then the fund house will deduct 10% TDS before paying it to you.\u200b<\/li>\n<\/ul>\n\n\n\n<p><strong>Pro Tip-<\/strong> Choose direct plans and low expense ratio as it means high long-term returns<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_to_Use_an_SIP_CalculatorGoal_Planner\"><\/span><strong>How to Use an SIP Calculator\/Goal Planner<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"207\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-7-1024x207.webp\" alt=\"How to Use an SIP Calculator\/Goal Planner\" class=\"wp-image-10682\" srcset=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-7-1024x207.webp 1024w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-7-300x61.webp 300w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-7-768x155.webp 768w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-7.webp 1201w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>Here\u2019s a clear or simple guide on how to use a goal planner or systematic investment plan calculator:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Start with your Goal<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Decide what you are planning for:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Education<\/li>\n\n\n\n<li>Vacation<\/li>\n\n\n\n<li>Buying a car, house, etc.<\/li>\n<\/ul>\n\n\n\n<ol start=\"2\" class=\"wp-block-list\">\n<li><strong>Enter your Investment Duration<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Decide for how long you want to invest, like 5 years, 10 years, or a longer duration.<\/p>\n\n\n\n<ol start=\"3\" class=\"wp-block-list\">\n<li><strong>Add expected Return Rate.<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Enter the expected annual return on the basis of asset type:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Hybrid fund: 8-10%<\/li>\n\n\n\n<li>Equity fund: 10-14%<\/li>\n\n\n\n<li>Debt fund: 6-8%<\/li>\n<\/ul>\n\n\n\n<ol start=\"4\" class=\"wp-block-list\">\n<li><strong>Select the type of planning.<\/strong><\/li>\n<\/ol>\n\n\n\n<p>You can choose the calculator in two ways:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li>To find SIP Amount<\/li>\n<\/ol>\n\n\n\n<p>If you know the goal amount<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Enter financial target, time period, and expected return.<\/li>\n<\/ul>\n\n\n\n<ol start=\"2\" class=\"wp-block-list\">\n<li>To find Future Value<\/li>\n<\/ol>\n\n\n\n<p>If you know how much you can invest monthly:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Enter SIP amount, time period, and expected return.<\/li>\n<\/ul>\n\n\n\n<ol start=\"5\" class=\"wp-block-list\">\n<li><strong>Adjust and compare<\/strong><\/li>\n<\/ol>\n\n\n\n<p>You can compare your plan with other plans and change or adjust:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Monthly systematic investment plan (SIP)<\/li>\n\n\n\n<li>Time period<\/li>\n\n\n\n<li>Expected returns<\/li>\n<\/ul>\n\n\n\n<ol start=\"6\" class=\"wp-block-list\">\n<li><strong>Review the result<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Review the total invested amount, expected return earned, and expected maturity amount.<\/p>\n\n\n\n<ol start=\"7\" class=\"wp-block-list\">\n<li><strong>Take Action<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Once you feel that the plan is good:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Start a systematic investment plan in the appropriate fund.<\/li>\n\n\n\n<li>Check yearly and adjust if required.<\/li>\n<\/ul>\n\n\n\n<p>\u201cThe market keeps falling or rising so there is no sense in delaying your SIP\u201d\u2013Value Research\u00a0<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"SIPs_and_Inflation_Real_vs_Nominal_Returns\"><\/span>SIPs and Inflation: Real vs Nominal Returns<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"206\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-8-1024x206.webp\" alt=\"SIPs and Inflation: Real vs Nominal Returns\" class=\"wp-image-10683\" srcset=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-8-1024x206.webp 1024w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-8-300x60.webp 300w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-8-768x155.webp 768w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-8.webp 1201w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Aspects\u00a0<\/strong><\/td><td><strong>Nominal Returns<\/strong><\/td><td><strong>Real Returns<\/strong><\/td><\/tr><tr><td><strong>Meaning\u00a0<\/strong><\/td><td>Returns is reported without considering inflation<\/td><td>Gains measured once increased price taken into account<\/td><\/tr><tr><td><strong>What it Reveal<\/strong><\/td><td>How much your money have grown<\/td><td>How much your purchasing power have grown<\/td><\/tr><tr><td><strong>Looks Like\u00a0<\/strong><\/td><td>Bigger number<\/td><td>Realistic number<\/td><\/tr><tr><td><strong>Formula<\/strong><\/td><td>\u00a0 \u00a0 \u00a0 _____________<\/td><td>Nominal Returns-Inflation<\/td><\/tr><tr><td><strong>Example\u00a0<\/strong><\/td><td>10% return (inflation ignored)<\/td><td>10%\u20135%=5% real return<\/td><\/tr><tr><td><strong>Risk<\/strong><\/td><td>Can overestimate wealth<\/td><td>Depict true picture<\/td><\/tr><tr><td><strong>Impact on SIPs<\/strong><\/td><td>The final amount appears inflated\u00a0<\/td><td>Actual buying power may be less<\/td><\/tr><tr><td><strong>Best for\u00a0<\/strong><\/td><td>Simple estimation<\/td><td>Smart long term planning<\/td><\/tr><tr><td><strong>If Inflation is High<\/strong><\/td><td>The gains seems attractive before inflation<\/td><td>Real gains may reduce or go negative<\/td><\/tr><tr><td><strong>Goal Planning\u00a0<\/strong><\/td><td>Might not enough to cover future expenses<\/td><td>Assist in setting goals that show real future cost<\/td><\/tr><tr><td><strong>SIP Suitability<\/strong>\u00a0<\/td><td>Applies to numerous assets<\/td><td>Equity SIP are more capable protecting and growing real buying power\u00a0<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Strategies_for_Successful_SIP_Investing\"><\/span>Strategies for Successful SIP Investing<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Strategies-for-Successful-SIP-Investing-1024x276.webp\" alt=\"Strategies for Successful SIP Investing\" class=\"wp-image-5731\"\/><\/figure>\n\n\n\n<p><strong>Goal-Based SIPs<\/strong><\/p>\n\n\n\n<p>One effective method of savings is to align SIP to specific financial goals. These objectives can be short-term or long-term short-term like saving for a vacation or long-term office, starting a business or planning for retirement etcetera. Overall, identifying the correct goals allows investors to select mutual funds for the SIP that matches their goals, investment, type, and risk tolerance. Goal-oriented SIPs keep you engaged and motivated, ensuring that your investments contribute to your financial goals.<\/p>\n\n\n\n<p><strong>SIPs for Short-Term vs. Long-Term Goals<\/strong><\/p>\n\n\n\n<p>When investing in SIPs, it\u2019s essential to differentiate between short-term and long-term goals:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Short-Term Goals<\/strong>: For this, one needs to do SIP in low risk funds such as debt or equity funds for 1 to 3 years. These funds are more secure and less risky, making them perfect for saving money with less risk involved in short-term.<\/li>\n<\/ul>\n\n\n\n<p><strong>Long-Term Goals<\/strong>: Consider SIPs in stock or mutual funds to achieve five-year objectives. These funds have higher growth rates since they are invested in mutual funds, which benefit from compounding. Despite the risks, investment expansion provides the potential to satisfy the market\u2019s vision, which can result in significant benefits.<\/p>\n\n\n\n<p><strong><a href=\"https:\/\/www.gettogetherfinance.com\/blog\/portfolio-diversification\/\" target=\"_blank\" rel=\"noreferrer noopener\">Portfolio Diversification<\/a> through Systematic Investment Plans<\/strong><\/p>\n\n\n\n<p>Diversity in the portfolio is very important as it helps in reducing risk and increasing the returns. Instead of putting all of your hard-earned money in one mutual fund, it is important that you diversify your SIP into several types of funds. For example, you need to spread your holdings or money into equities, debt funds and hybrid funds. This type of diversification in SIP portfolio helps to manage risk and returns, ensuring that if one fund performs badly in certain market scenarios, its losses are recovered with the profits of others. Furthermore, you can diversify the terrain by investing in overseas funds, which reduces risk while increasing growth.<\/p>\n\n\n\n<p>By using this method, you may optimize your SIP investments to meet your financial objectives while lowering risk and boosting returns.<\/p>\n\n\n\n<p><strong>Pro Tip- <\/strong>Don\u2019t chase top-performing funds, instead of this, look for:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Long term stability<\/li>\n\n\n\n<li>Consistency<\/li>\n\n\n\n<li>Fund manager track record<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"SIP_vs_Other_Investment_Vehicles\"><\/span>SIP vs Other Investment Vehicles<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"206\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-9-1024x206.webp\" alt=\"SIP vs Other Investment Vehicles\" class=\"wp-image-10684\" srcset=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-9-1024x206.webp 1024w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-9-300x60.webp 300w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-9-768x155.webp 768w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-9.webp 1201w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Feature<\/strong><\/td><td><strong>Systematic Investment Plan<\/strong><\/td><td><strong>Lump Sum Investment\u00a0<\/strong><\/td><td><strong>Recurring Deposit (RD)<\/strong><\/td><td><strong>Public Provident Fund (PPF)<\/strong><\/td><td><strong>Direct Stock Investing\u00a0<\/strong><\/td><\/tr><tr><td><strong>Investment Style<\/strong><\/td><td>Small, regular monthly investing\u00a0<\/td><td>One-time large investment\u00a0<\/td><td>Fixed monthly deposit\u00a0<\/td><td>Fixed partially\/ monthly deposit\u00a0<\/td><td>Fixed long term deposit, monthly\/yearly<\/td><\/tr><tr><td><strong>Risk Level<\/strong><\/td><td>Moderate to high<\/td><td>Moderate to high<\/td><td>Very low<\/td><td>Very low<\/td><td>High to very high<\/td><\/tr><tr><td><strong>Investment Amount\u00a0<\/strong><\/td><td>Rs100-500+<\/td><td>Requires large capital<\/td><td>Fixed monthly deposit<\/td><td>Yearly contribution (Rs100-1.5 lakh)<\/td><td>No fixed rule;rely on stock price<\/td><\/tr><tr><td><strong>Return Guarantee<\/strong><\/td><td>No\u00a0<\/td><td>No\u00a0<\/td><td>Yes\u00a0<\/td><td>Yes\u00a0<\/td><td>No\u00a0<\/td><\/tr><tr><td><strong>Liquidity\u00a0<\/strong><\/td><td>High\u00a0<\/td><td>High\u00a0<\/td><td>Premature withdrawal penalty<\/td><td>Low\u00a0<\/td><td>High\u00a0<\/td><\/tr><tr><td><strong>Volatility Impact\u00a0<\/strong><\/td><td>Your average cost become more even over time\u00a0<\/td><td>Fully exposed at entry point\u00a0<\/td><td>No volatility (guaranteed)\u00a0<\/td><td>No volatility (guaranteed)\u00a0<\/td><td>Very high volatility\u00a0<\/td><\/tr><tr><td><strong>Expertise needed\u00a0<\/strong><\/td><td>Low\u00a0<\/td><td>Moderate\u00a0<\/td><td>None\u00a0<\/td><td>None\u00a0<\/td><td>High\u00a0<\/td><\/tr><tr><td><strong>Taxation\u00a0<\/strong><\/td><td>Capital gains tax based on duration and fund type<\/td><td>Capital gains tax based on asset and duration<\/td><td>Interest tax as per income slab\u00a0<\/td><td>Tax free maturity+section 80C benefit\u00a0<\/td><td>Capital gains tax based on holding period<\/td><\/tr><tr><td><strong>Goal Suitability\u00a0<\/strong><\/td><td>Wealth creation, long term gaols\u00a0<\/td><td>Wealth creation with large surplus<\/td><td>Safe saving, short term needs<\/td><td>Retirement and long term safety\u00a0<\/td><td>Aggressive wealth growth\u00a0<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Top_Mutual_Funds_to_Do_SIP_Systematic_Investment_Plan\"><\/span>Top Mutual Funds to Do SIP (Systematic Investment Plan)<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Top-Mutual-Funds-to-Do-SIP-Systematic-Investment-Plan-1024x276.webp\" alt=\"Top Mutual Funds to Do SIP (Systematic Investment Plan)\" class=\"wp-image-5732\"\/><\/figure>\n\n\n\n<p>Here are some top mutual funds for investing. But remember to conduct your own research before putting your money in any fund or security.\u00a0<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Category<\/strong><\/td><td><strong>Mutual Fund Name<\/strong><\/td><td><strong>1-Year Return<\/strong><\/td><td><strong>3-Year Return<\/strong><\/td><td><strong>5-Year Return<\/strong><\/td><td><strong>Minimum SIP Amount<\/strong><\/td><\/tr><tr><td><strong>Large-Cap Equity<\/strong><\/td><td>Axis Bluechip Fund<\/td><td>15%*<\/td><td>20%*<\/td><td>18%*<\/td><td>\u20b9500<\/td><\/tr><tr><td><strong><a href=\"https:\/\/www.gettogetherfinance.com\/blog\/nifty-midcap-index\/\" target=\"_blank\" data-type=\"post\" data-id=\"4782\" rel=\"noreferrer noopener\">Mid-Cap<\/a> Equity<\/strong><\/td><td>DSP Midcap Fund<\/td><td>22%*<\/td><td>25%*<\/td><td>21%*<\/td><td>\u20b9500<\/td><\/tr><tr><td><strong>Small-Cap Equity<\/strong><\/td><td>SBI Small Cap Fund<\/td><td>24%*<\/td><td>28%*<\/td><td>23%*<\/td><td>\u20b9500<\/td><\/tr><tr><td><strong>Multi-Cap Equity<\/strong><\/td><td>Kotak Standard Multicap Fund<\/td><td>18%*<\/td><td>22%*<\/td><td>20%*<\/td><td>\u20b9500<\/td><\/tr><tr><td><strong>ELSS (Tax Saving)<\/strong><\/td><td>Mirae Asset Tax Saver Fund<\/td><td>17%*<\/td><td>21%*<\/td><td>19%*<\/td><td>\u20b9500<\/td><\/tr><tr><td><strong>Hybrid<\/strong><\/td><td>ICICI Prudential Equity & Debt Fund<\/td><td>12%*<\/td><td>15%*<\/td><td>14%*<\/td><td>\u20b9100<\/td><\/tr><tr><td><strong>Debt<\/strong><\/td><td>HDFC Short Term Debt Fund<\/td><td>8%*<\/td><td>9%*<\/td><td>8.5%*<\/td><td>\u20b9500<\/td><\/tr><tr><td><strong>Balanced<\/strong><\/td><td>HDFC Balanced Advantage Fund<\/td><td>14%*<\/td><td>18%*<\/td><td>16%*<\/td><td>\u20b9500<\/td><\/tr><tr><td><strong>Index<\/strong><\/td><td>UTI Nifty Index Fund<\/td><td>13%*<\/td><td>17%*<\/td><td>15%*<\/td><td>\u20b9500<\/td><\/tr><tr><td><strong>International<\/strong><\/td><td><a href=\"https:\/\/en.wikipedia.org\/wiki\/Franklin_Templeton_Investments\" target=\"_blank\" data-type=\"URL\" data-id=\"https:\/\/en.wikipedia.org\/wiki\/Franklin_Templeton_Investments\" rel=\"noreferrer noopener\">Franklin India Feeder \u2013 Franklin US Fund<\/a><\/td><td>10%*<\/td><td>14%*<\/td><td>12%*<\/td><td>\u20b9500<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Things_to_Consider_Before_Starting_SIP\"><\/span>Things to Consider Before Starting SIP<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"207\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-10-1024x207.webp\" alt=\"Things to Consider Before Starting SIP\" class=\"wp-image-10685\" srcset=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-10-1024x207.webp 1024w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-10-300x61.webp 300w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-10-768x155.webp 768w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-10.webp 1201w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>Before starting a SIP, it\u2019s important to assess your <strong>financial goals<\/strong>, <strong>investment horizon<\/strong>, and <strong>risk appetite<\/strong>. Choose the right mutual fund that aligns with your objectives\u2014whether it\u2019s for long-term wealth creation, tax saving, or short-term goals. Also, ensure consistency in contributions and have a clear understanding of the fund\u2019s past performance, expense ratio, and fund manager\u2019s credibility.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"When_to_Review_or_Rebalance_a_Systematic_Investment_Plan_Portfolio\"><\/span>When to Review or Rebalance a Systematic Investment Plan Portfolio<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"207\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-11-1024x207.webp\" alt=\"When to Review or Rebalance a Systematic Investment Plan Portfolio\" class=\"wp-image-10686\" srcset=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-11-1024x207.webp 1024w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-11-300x61.webp 300w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-11-768x155.webp 768w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-11.webp 1201w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Situation\u00a0<\/strong><\/td><td><strong>What to Do<\/strong><\/td><td><strong>Why it Matters\u00a0<\/strong><\/td><\/tr><tr><td><strong>Once in a year\u00a0<\/strong><\/td><td>Review\u00a0<\/td><td>Market and goals can change over time<\/td><\/tr><tr><td><strong>Goals Change\u00a0<\/strong><\/td><td>Review and adjust<\/td><td>Make sure that the portfolio matches new objectives\u00a0<\/td><\/tr><tr><td><strong>Every 12-18 months<\/strong><\/td><td>Rebalance\u00a0<\/td><td>Align your asset mix with your planned proportion<\/td><\/tr><tr><td><strong>Major Market Crash or Surge<\/strong><\/td><td>Rebalance if the proportion deviate by 10% from your plan<\/td><td>Assist in avoiding too much or too little market exposure\u00a0<\/td><\/tr><tr><td><strong>Risk Tolerance Changes\u00a0<\/strong><\/td><td>Rebalance and readjust<\/td><td>Portfolio should match your comfort with risk<\/td><\/tr><tr><td><strong>Major Life Events (house, child etc.)<\/strong><\/td><td>Review\u00a0<\/td><td>Life changes may shift your investment and risk duration capacity\u00a0<\/td><\/tr><tr><td><strong>Fund Underperformed for 12-18 months\u00a0<\/strong><\/td><td>Think about switching to a different fund<\/td><td>Long term weakness could reduce your overall profit<\/td><\/tr><tr><td><strong>3-5 years before Goals<\/strong><\/td><td>Lower equity, shift towards safer asset\u00a0<\/td><td>Reduce the risk of unexpected value drops in your portfolio\u00a0<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><strong>Pro Tip-<\/strong> Increase SIP every year to boost wealth.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Common_Mistakes_Investors_Make_with_SIPs_in_India\"><\/span><strong>Common Mistakes Investors Make with SIPs in India<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"206\" src=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-12-1024x206.webp\" alt=\"Common Mistakes Investors Make with SIPs in India\" class=\"wp-image-10687\" srcset=\"https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-12-1024x206.webp 1024w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-12-300x60.webp 300w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-12-768x155.webp 768w, https:\/\/www.gettogetherfinance.com\/blog\/wp-content\/uploads\/2024\/07\/Artboard-12-copy-12.webp 1201w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>Here are some commonly seen mistakes that Indian investors make with SIP:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Expecting Quick Returns<\/strong><\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Systematic investment plans are primarily designed for long-term compounding.<\/li>\n\n\n\n<li>People expect results in 1-3 years, which often leads to disappointment. Basically, they don\u2019t know how SIP works.<\/li>\n<\/ul>\n\n\n\n<ol start=\"2\" class=\"wp-block-list\">\n<li><strong>Not Increasing SIP Amount Over Time<\/strong><\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The income of people rises, but not the SIP amount.<\/li>\n\n\n\n<li>Ignoring SIP top-ups lowers long-term wealth creation.<\/li>\n<\/ul>\n\n\n\n<ol start=\"3\" class=\"wp-block-list\">\n<li><strong>Investing without a Clear Goal<\/strong><\/li>\n<\/ol>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Generally, people don\u2019t know how to start a systematic investment plan with a clear goal.<\/li>\n\n\n\n<li>Staring SIP without having clear goals results in:<\/li>\n\n\n\n<li>Withdrawing money without a proper plan.<\/li>\n\n\n\n<li>Choosing the wrong funds.<\/li>\n\n\n\n<li>Stopping it midway.<\/li>\n<\/ul>\n\n\n\n<ol start=\"4\" class=\"wp-block-list\">\n<li><strong>Having Too Many SIP Funds<\/strong><\/li>\n<\/ol>\n\n\n\n<p>      Having too many funds results in confusion, diluted returns, and duplication.<\/p>\n\n\n\n<ol start=\"5\" class=\"wp-block-list\">\n<li><strong>Selecting Returns Only Based on Past Returns<\/strong><\/li>\n<\/ol>\n\n\n\n<p>      Many investors choose a fund on the basis of how they performed in recent months.<\/p>\n\n\n\n<ol start=\"6\" class=\"wp-block-list\">\n<li><strong>Stopping SIPs when the Market Falls<\/strong><\/li>\n<\/ol>\n\n\n\n<p>Most of the investors stop their SIPs when the market falls- but this is the time when it works well because you can buy more units at cheaper rates.\u00a0<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion\u00a0<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Systematic investment plans (SIP) offers an organised and very disciplined approach for investing and wealth accumulation over time. SIP allows regular investing that benefits from rupee cost and ageing and compounding, all this while promoting financial discipline and amazing flexibility for investing. SIPs are available for investors with a variety of financial objectives. They can be done for long-term as well as short-term goals and can be customized according to individual tolerance and preferences based on different funds. Using SIPs can simplify your investment journey, allowing you to achieve great financial development and ensure a prosperous future. Begin your SIP today and see your wealth increase slowly and securely.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Frequently_Asked_Questions\"><\/span>Frequently Asked Questions<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n<div id=\"rank-math-faq\" class=\"rank-math-block\">\n<div class=\"rank-math-list \">\n<div id=\"faq-question-1721630866993\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"What_is_the_minimum_amount_required_to_start_a_SIP\"><\/span><strong>What is the minimum amount required to start a SIP?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Mutual funds offer SIPs starting at \u20b9500 per month, making it accessible to individuals of all financial backgrounds.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1721630905157\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"Can_I_change_the_investment_amount_or_frequency_in_my_SIP\"><\/span><strong>Can I change the investment amount or frequency in my SIP?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Yes, SIPs provide flexibility. You can change the investment amount and frequency based on your financial position and aspirations.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1721630918908\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"Are_SIPs_suitable_for_both_short-term_and_long-term_financial_goals\"><\/span><strong>Are SIPs suitable for both short-term and long-term financial goals?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Absolutely. For short-term goals (1-3 years), think about low-risk debt or hybrid funds. Long-term goals (5+ years) are better suited to equities or multi-cap funds due to their larger growth potential.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1721630931652\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"What_happens_if_I_miss_a_SIP_installment\"><\/span><strong>What happens if I miss a SIP installment?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Missing an installment is usually not an issue. Most mutual funds allow you to continue your SIP without penalty, but you should examine the fund\u2019s specific restrictions.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1721630945451\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><span class=\"ez-toc-section\" id=\"Are_returns_from_SIPs_guaranteed\"><\/span><strong>Are returns from SIPs guaranteed?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>No, SIP returns are not guaranteed because they are subject to market risk. Regular SIP investing, on the other hand, might limit some risks while potentially yielding favorable long-term returns.<\/p>\n\n<\/div>\n<\/div>\n<\/div>\n<\/div>","protected":false},"excerpt":{"rendered":"<p>\u201cInvesting should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas.\u201d \u2013 Paul Samuelson. A Systematic Investment Plan&#8230;<\/p>\n","protected":false},"author":11,"featured_media":9725,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[63,129],"tags":[],"class_list":["post-5725","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mutual-funds","category-saving-scheme"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.gettogetherfinance.com\/blog\/wp-json\/wp\/v2\/posts\/5725","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.gettogetherfinance.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.gettogetherfinance.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.gettogetherfinance.com\/blog\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/www.gettogetherfinance.com\/blog\/wp-json\/wp\/v2\/comments?post=5725"}],"version-history":[{"count":13,"href":"https:\/\/www.gettogetherfinance.com\/blog\/wp-json\/wp\/v2\/posts\/5725\/revisions"}],"predecessor-version":[{"id":10911,"href":"https:\/\/www.gettogetherfinance.com\/blog\/wp-json\/wp\/v2\/posts\/5725\/revisions\/10911"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.gettogetherfinance.com\/blog\/wp-json\/wp\/v2\/media\/9725"}],"wp:attachment":[{"href":"https:\/\/www.gettogetherfinance.com\/blog\/wp-json\/wp\/v2\/media?parent=5725"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.gettogetherfinance.com\/blog\/wp-json\/wp\/v2\/categories?post=5725"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.gettogetherfinance.com\/blog\/wp-json\/wp\/v2\/tags?post=5725"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}