SIP Mutual Fund Investment Plan : Why SIP Investment is an Advantage - CRED
Download CRED
homearticles
7 reasons why sip investment is worth investing

7 reasons why sip investment is worth investing

sip is an advantageous investment option, but most individuals refrain from compounding their money through it, primarily due to lack of awareness
finance
February 21, 2021
6 min read
share facebookshare twittershare linkedinshare whatsapp
7 reasons why sip investment is worth investing

7 Reasons Why SIP Investment is Worth Investing

share
share facebookshare twittershare linkedin

a systematic investment plan is a popular investment option where investors give a fixed amount of their money monthly. it is an ideal option to compound your savings. it provides a return in the long term, however. read on to know why sip investment is worth considering :-

1. sips have small, affordable schemes

the amount of investment in sips is low compared to other investment schemes. the minimum requirement to open your sip investment account is ₹ 500 monthly. even individuals with low earning/savings can meet their investment goals given they choose the right sip plan. it is always best to use a sip calculator to calculate the correct sum of returns.

2. sip offer the advantage of flexibility to the investors

sip plans are flexible. the investment plans are adjustable according to the investor's requirements. start with a small amount once there is an increase in your savings; you can increase the investment amount. alternatively, you can go for a new sip plan according to your need.

3. regular investment can help people meet their financial goals

disciplined investment is crucial to gain high returns, and this is what makes sip investment worth considering. sip plans are created in a manner that the investors are required to invest money regularly every month. regular investments assure the compounding of your savings.

4. sip investments don't come with any time constraints

every investor can't keep track of the market or measure the market's performance accurately. investing your money in sips doesn't require too much market research. individuals need to invest a certain amount (as per the sip plan taken) per month irrespective of the market performance. however, on the safer side, you must always use the sip return calculator.

5. ideal money compounding formula

on selecting the growth sip option, the individuals' returns on their investment are added to the gross investment sum. it generates incomparable returns both in the short and long run. if you are looking for some severe investment options, sips will be highly rewarding.

6. sips aren't affected by short-term volatility in the market

the risk factor in the case of sips is comparatively low. also, investors must invest a fixed sum monthly, and the investment is for long-term withdrawing your money every often due to market volatility doesn't remain a feasible option. sips give good returns in the long-term, so you need not speculate the profit/loss now and then. just make sure to use the mutual fund sip calculator to calculate your profits from time to time.

7. safe for both beginners and pro investors

sebi and amfi have some strict rules and regulations so that investors don't have to face any issues with sip investment. all the plans are according to the policies laid by the amc, which makes the industry safe and transparent for sip investors.

final takeaway

individuals who don't consider sip investment either don't have sufficient knowledge or are scared due to the losses that occur otherwise. however, it is to be noted that this industry comes under the regulation of sebi, so there is no chance of malpractices.