SIP In Mutual Funds Is A Wise Investment Decision

SIP mutual funds are smart choice, any day. It helps inculcate a financial discipline and helps you put investments on your priority list. This particular investment plan gives you the benefit of averaging out your cost of investment thereby reducing your risk. For example, you invest Rs. 1000 every month and let us assume that the scheme you invested in, is available at a unit value of Rs. 20 per unit. Then in month 1, you will be able to obtain 50 units. In month 2, if the unit value goes down to Rs. 10 then you will be able to obtain 100 units. Hence for Rs. 2000 invested over 2 months, the total value of your investment at the end of 2 months is Rs. 1500. However, if you had invested a straight sum of Rs. 2000 in month 1 when the unit value was Rs. 20 per unit – your net value at the end of month 2 would have been only be Rs. 1000. So, a SIP scheme helps you average out your cost and thereby reduces risk resulting in generating better returns and compounding your wealth.

SIP has given all middle class a success formula, which is Start Early + Invest Regularly = Create Wealth. Since systematic investing has a compounding effect on your investments, in the long term, an investment as low as Rs 1000/- per month can swell up into a huge corpus. Similarly, starting your investments early also has its own advantages. Starting early means that the power of compounding starts acting on your money earlier, thereby potentially generating better returns. Now, as you decide to start with SIP, the purchase can be initiated on any day of the month where the actual purchase date can be 1, 7, 10, 15, 20, 28 of every month. But it is always advised to go with the last dates of the month because by then, you must have met out all your necessary expenses.

Make Your Investments Easy And Fruitful With SIP

If you are also like those investors who seek a good and safe way to make investments and want to gain good as well as assured returns, then SIP investment might suit you too. As per SIP, you can start investing with a small amount in a systematic way and can attain an assured amount of sum after a specific time. Not only this, SIP also allows an investor to invest in various mutual funds while lowering the risks of investments. It gives an investor a number of benefits because it is the best scheme to invest. It is also good for those who invest on a regular basis as it is a dependable option.

SIP requires a certain amount of money to be invested on a quarterly, monthly, or annually basis. If you are unable to select a scheme on your own, then you can consult wealth advisory firms and can tell them your budget and returns you are looking for. Your hired certified financial planner will surely get the best SIP plan for you, within your budget. As you take up SIP, you can start investing with a small amount of money without affecting your budget. It is usually seen that for most of us, including me, investments are often the last item on a person's priority list. After all the expenses are met, whatever funds are surplus, they are generally what get invested. The correct way to go about investing is in fact the exact opposite. One should first set out goals for the investments and define the targets with time frames. These goals should ideally also have certain priority attached to each one. This allows for the investor to be able to choose the one with the highest priority to be fulfilled first. To conclude, mutual fund investments have certainly been made easy with SIPs.