Decoding SIP Investment: A Beginner’s Guide
In the previous article, we discussed foreign investment. In this article, we will discuss SIP investments.
SIP, also known as a Systematic Investment Plan, is a facility offered by mutual funds to investors to invest in a fund properly. With a SIP facility, investors can invest a fixed amount of money in pre-defined intervals.
Note that the fixed amount of money can be as low as INR 500. The SIP route to investment is necessary as it helps you to invest in a time-bound manner. There is no need to worry about market dynamics when you are investing via SIPs.
What is SIP investment?
Currently, Indian Mutual Funds have currently about 5.5 crore SIP accounts through which investors invest in various schemes.
A SIP is one of the two ways in which you can invest in a mutual fund scheme. The other way to invest in mutual funds is through a lump sum amount. In a SIP, you essentially invest a fixed amount of your money on a specific date.
Note that every mutual fund comes with its own minimum investment amount that you have to strictly adhere to. To achieve financial success in our lives, we typically tend to work harder. And it is only by working hard that we can achieve our objectives in life. But with a SIP, your success is always in progress.
SIP allows you to invest in mutual funds monthly, quarterly, and step-by-step. It is essential to note here that SIP averages out your cost of investing.
Moreover, with SIPs, you can benefit from the power of compounding. What makes SIPs stand out is their ability.
SIP plans for child’s education
Top 10 mutual funds for SIP to Invest in 2023
Here are the top ten mutual funds for SIP to invest in 2023:
|Name of the Fund
|DSP Tax Saver Fund Direct Plan Growth Option
|India Fund: ELSS
|DSP Flexi Cap Fund Direct Plan-Growth
|India Fund: Flexi Cap
|Quant Active Fund Growth Option Direct Plan
|Axis Midcap Fund Direct Plan-Growth
|Navi Nifty 50 Index Fund Direct-Growth
|Index Fund – Nifty
|Navi Nifty Next 50 Index Fund Direct-Growth
|Index Fund – Nifty Next 50
|Axis Small Cap Fund Direct-Growth
|ICICI Prudential Technology Fund – Direct Plan-Growth
|Thematic – Technology
|ICICI Prudential Balanced Advantage Fund Direct Plan-Growth
|Dynamic Asset Allocation
|Tata Hybrid Equity Fund – Direct Plan-Growth
How to invest in SIP?
Investing in a SIP has become pretty simple. As an investor, you can invest in SIPs right from the comfort of your home. Here are the necessary steps to follow while investing in a SIP.
1. Keep all the Necessary Documents Ready
You have to ensure that all the essential documents are ready before starting to invest. Since it is a long procedure, you can keep all the important documents handy like PAN card, ID proof, and address proof.
Also, ensure that your bank account and PAN details are correct.
2. Get your KYC Done
Comply with KYC norms before investing in any financial product. For KYC registration, you can also apply online.
3. Register for a SIP
To start investing in a SIP, you need to register with financial advisors or institutions. After registering, you can choose from a large number of funds.
4. Select the Right SIP Plan for Good Returns
- Selecting the right SIP plan is one of the most crucial aspects. If you fail to choose the right plan, it will be tough to get a good return on your overall investment. Before investing in a SIP, consider the below-mentioned parameters.
- Risks associated with the SIP
- The number of units involved in a SIP investment
- The type of investor you are
Select the Amount:
Select the amount you want to invest in the scheme
How can you invest in SIP using EduFund?
Saving for your child’s education is easy when you have a financial partner to help you. From calculating the cost of education in different countries for different courses to saving via SIPs in 4000+ mutual funds from top AMCs like TATA, Navi, and DSP; you start at just Rs. 100!
Here is how simple it is to save with EduFund
- Using the College Cost Calculator, find out how much you need to save for your child’s education
- Once you know much you need, start saving via SIP or Lumpsum. You can get the monthly amount based on your budget and explore the customized funds that can help you get closer to your goal
- After selecting the funds, allow the SIP mandate from your bank account or make a lump sum order. That’s it! You are ready to fund your child’s dream education in no time!
SIP is a great way to reach long-term and short-term goals. You can start a SIP for saving up for your child’s college to his/her laptop by deciding how much you need to invest every month and when you need the funds for your set goal.
Make the most of the financial instruments and start saving!
What does an SIP means?
Systematic Investment Plans or SIPs is a popular way of investing in investment tools like Mutual Funds, ETFs and stocks. SIPs build financial discipline, help one build wealth for the future and a steady corpus for emergencies. You can start small and invest monthly in mutual funds.
Is SIP better than FD?
SIPs offer higher interest rates than FDs. Both are great investments to build future wealth.
Which SIP is best for 1000 per month?
Here are some good mutual funds to consider:
DSP Tax Saver Fund Direct Plan Growth Option Equity India Fund: ELSS
DSP Flexi Cap Fund Direct Plan-Growth Equity India Fund: Flexi Cap
Quant Active Fund Growth Option Direct Plan Equity Multi-cap
Axis Midcap Fund Direct Plan-Growth Equity Mid-cap
Navi Nifty 50 Index Fund Direct-Growth