What is SIP?
Systematic Investment Plan (SIP) is a disciplined way to invest in mutual funds that helps you build wealth through the power of compounding and rupee cost averaging.
Try SIP CalculatorUnderstanding Systematic Investment Plan
Regular Investment
Invest a fixed amount regularly (monthly/quarterly) to build a disciplined investment habit and reduce market timing risks.
Rupee Cost Averaging
Buy more units when prices are low and fewer when prices are high, averaging out your investment cost over time.
Power of Compounding
Your returns earn returns, creating exponential growth over long investment horizons. Time is your greatest ally.
Flexibility
Start with as low as ₹500, increase/decrease amounts, pause, or stop anytime based on your financial situation.
Key Benefits of SIP Investment
SIP enforces a regular investment habit, helping you stay committed to your financial goals regardless of market conditions. This systematic approach eliminates emotional decision-making and ensures consistent wealth building.
- Automated investment process
- Removes emotional bias
- Builds long-term wealth systematically
Rupee cost averaging reduces the impact of market volatility by spreading your investments across different market cycles. You buy more units when markets are down and fewer when markets are up.
- Reduces average cost per unit
- Minimizes market timing risks
- Smoothens investment journey
Start your investment journey with just ₹500 per month. SIP makes mutual fund investing accessible to everyone, regardless of income level.
- Low minimum investment (₹500)
- Flexible amount and frequency
- Option to increase, pause, or stop
The power of compounding works best with time. Your returns generate further returns, creating a snowball effect that accelerates wealth creation significantly over long periods.
- Returns earn returns over time
- Exponential growth in later years
- Time multiplies your wealth
How SIP Works - Step by Step
Choose Fund
Select a mutual fund scheme that aligns with your risk profile and investment goals.
Set Amount
Decide the investment amount and frequency (monthly, quarterly) based on your budget.
Auto Debit
Set up auto-debit from your bank account for hassle-free regular investments.
Watch Growth
Track your investment growth and let compounding work its magic over time.
SIP vs Lump Sum Investment
| Aspect | SIP | Lump Sum |
|---|---|---|
| Investment Amount | Small regular amounts (₹500+) | Large one-time amount |
| Market Timing | No need to time the market | Requires market timing |
| Risk | Lower due to rupee cost averaging | Higher market timing risk |
| Discipline | Enforces regular investment habit | One-time decision |
| Liquidity Need | Low - only monthly amount | High - large amount needed |
| Emotional Impact | Reduces emotional stress | Higher emotional involvement |
| Best For | Regular income earners, beginners | Experienced investors, market lows |
Types of SIP Investment
Regular SIP
Fixed amount invested at regular intervals. Most common and simple form of SIP.
- Fixed monthly investment
- Easy to plan and budget
- Ideal for beginners
Step-up SIP
Investment amount increases annually by a fixed percentage (5-15%).
- Matches salary increments
- Accelerates wealth creation
- Beats inflation effectively
Flexible SIP
Adjust investment amount based on market conditions and cash flow.
- Variable investment amounts
- Adapt to financial situation
- Market-based adjustments
Perpetual SIP
No end date specified. Continues until manually stopped by investor.
- No maturity constraints
- Long-term wealth building
- Maximum compounding benefit
Ready to Start Your SIP Journey?
Use our free SIP calculator to plan your investments and see how your money can grow over time.
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