Systematic Investment Plan, commonly known as SIP allows you to invest regularly, a fixed sum in your selected mutual fund. In SIP, a fixed amount is deducted from your bank account every month and directed towards the mutual fund you choose to invest in.

SIP offers many benefits. A few of them are: Brings Discipline:- Investing on a pre-set date every month, makes you set aside a fixed sum of money to invest and gradually turns you into a disciplined investor. Power of Compounding: Unlike traditional investment options where interest is calculated on the initial investment at a pre-defined frequency, Mutual Funds provide you market-linked returns generated on a daily basis on the amount accumulated till the previous day. Benefit of Rupee Cost Averaging: You get more units when the market goes down and less when the market goes up. Thus, you average-out the cost of total units bought. It is a convenient method of investing as you can start with a minimum amount of INR 500 per month.

Starting an SIP is easy. First, you need to select a fund that is best suited to your long-term goals and risk profile. You can do this yourself, or you can take the help of a professional financial advisor. Once you have zeroed-in on a fund, you need to fill the SIP application form, post which a fixed amount is deducted from your bank account every month and directed towards the mutual fund you choose to invest in.

Unlike traditional fixed income products, Mutual Fund investments do not provide a guaranteed return. But, historically, over a long-term, investments in Equity Funds have generated better returns than traditional fixed-income products. Having said that, Mutual Fund investments are subject to market risks. You are advised to read all scheme related documents carefully before investing.

There is no such thing as a “Best Mutual Fund.” It is a myth. Every fund has a unique investment objective that caters to the needs of different investors. You need to select the right fund for yourself based on your risk appetite and time-frame for achieving your life goals.

The minimum amount to start an SIP varies from fund-to-fund. Having said that, many funds in India now let you start an SIP of 500 rupees. Investing via SIP is not limited to small amounts. You can invest any amount you want. There is no upper limit on SIP, Minimum tenure of SIP is 6 months, whereas there is no maximum tenure.

Investing via SIP is not limited to small amounts. You can invest any amount you want. There is no upper limit on SSIP.

Yes, you can start more than one SIP. There is no restriction on the number of Systematic Investment Plans you can have at a given point of time.

Yes, you can generally withdraw your investment from a SIP at any time, unless the SIP is invested in a tax-saving mutual fund, such as an Equity Linked Savings Scheme (ELSS), which has a mandatory lock-in period of three years. However, it’s important to check if there are any exit loads, which are fees charged for withdrawing your investment within a certain period. Withdrawal policies can vary depending on the fund house and the specific mutual fund product.

Yes, you can increase your SIP amount at any point. There are two ways to do that. You can either start a new SIP with the additional amount or you can opt for a facility, commonly known as SIP Booster or SIP Top-up, that lets you increase your SIP instalment amount at a pre-defined interval.

Yes, you can stop your SIP instalment at any point of time. There are no charges levied for stopping an SIP. Moreover, you can withdraw the corpus accumulated through previous instalments.

No, SIPs are not tax-free. The tax implications depend on the type of mutual fund you have invested in through your SIP. For equity funds, if you sell your investment after more than one year, the gains are subject to a Long-Term Capital Gains tax (LTCG) of 10% on gains exceeding ₹1 lakh annually. If sold before a year, the gains are taxed at 15% as Short-Term Capital Gains tax (STCG). For all debt mutual funds purchased after 1st April 2023 any gains irrespective of holding period will be deemed to be short term capital gain and tax will be levied at slab rate

Missing a SIP instalment typically does not result in a penalty from the mutual fund company; however, it could impact your investment goals by reducing the amount accumulated at the end of your investment period. If you miss a SIP payment due to insufficient funds in your bank account, most fund houses give you the option to make up for the missed investment or simply continue with the next scheduled instalment. It’s important to maintain sufficient balance in your account on the due date to avoid missing SIP contributions.

No, you can’t switch your SIP from one fund to another. You will need to stop the current one and start a new one in your desired fund. But, the corpus accumulated through past instalments, in an open-ended fund without lock-in period, can be switched to another fund.

There is no penalty levied by Mutual Funds if your account balance is insufficient when the SIP instalment is due. It’s just that your instalment for that particular month will not be processed, but your SIP will continue normally next month onwards, provided the balance is sufficient.

Yes, it is possible to invest in an ELSS fund through SIP.

SIP is a good habit of saving & investing a fixed amount regularly with an objective of creating wealth over long term. Hence, an SIP should be done for perpetuity, unless you are starting an SIP for a specific goal which is due on a particular date.

SIP is a good habit of saving & investing a fixed amount regularly with an objective of creating wealth over long term. Hence, an SIP should be done for perpetuity, unless you are starting an SIP for a specific goal which is due on a particular date.

Assuming a same rate of return, a weekly frequency will turn out to be a better choice as you get the benefit of compounding. Unfortunately, the market returns are not predictable. Hence, there is no correct answer as to which frequency is better. That being said, it is advisable to select the frequency based on your cash flow. Hence, salaried individuals prefer a monthly frequency for their SIP.

Yes, you can start an SIP for any open-ended mutual fund.