SIP Investment Tips: Here are the easy steps
What is a SIP: A SIP is a method of investing a fixed amount each month in mutual funds. It protects against market fluctuations through rupee-cost averaging. Assuming a 12% average return, small investments can turn into millions. For example, a 10-year SIP of ₹10,000 can grow to ₹2.3 million. Compounding works its magic over the long term.
If you invest ₹8,000 every month for 15 years at a 12% annual rate, your total capital could be around ₹5.12 million. If the return is 15%, this amount could grow to ₹6.45 million.
An investment of ₹9,000 per month can result in a maturity value of ₹1.12 crore in 20 years, which will increase further at a 15% return. This amount is useful for retirement and meeting larger needs.
Investing ₹10,000 per month at a 12% rate can create a wealth of ₹1.25 crore in 20 years. If you continue this investment for 25 years, you could build a wealth of approximately ₹3.3 crore.
Equity funds offer higher returns but also carry risk. Index funds and hybrid funds are safer options for investors. Diversifying your investments is beneficial.
SIP gains are taxable, but ELSS funds offer tax-saving options. Continue investing while taking into account market fluctuations.
