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Know About The Sip Investment Plan Details

By Author: jignesh shah
Total Articles: 9

You can invest in mutual funds through Systematic Investment Plan (SIP). Investing regularly over a period of time can help you reach your goals. You can invest quarterly or monthly a per your convenience.

Before investing you should identify your goals. You should invest keeping your goal in mind. You should decide how much to invest and for how long. The amount to be invested regularly should help you reach your goal. Depending on your requirement you can invest for short term mid term or long term.

Now you can decide which funds to invest in. You can invest in the funds of your choice. Next you have to consider your ability to take risk. There are various funds and it is important to select the right funds. You should select the funds that suit your needs, fit your risk appetite and help you reach your goals. You should invest in 3 - 5 funds and diversify your investments.

If it gets difficult then you can always consult a financial advisor to find the sip investment plan details.

Why to do SIP?

There are various reasons to do an SIP. They are:

It brings discipline to your investments a you invest regularly.

As you invest a fixed sum regularly you can buy more units when the market is low and less when the market is high. This is called Rupee Cost Averaging.

It offers power of compounding.

It is convenient as you can invest small amount of money without affecting the household budget.

As you invest regularly you need not time the market. The long term investments are not affected by market fluctuations.

Find the SIP investment plan details

You should choose the funds depending on the duration of the investment. If you need to invest to own a car or home appliance or create emergency funds then you can invest for 0 - 3 years. This is short term investment and you should go for liquid and debt funds.

If you need to invest for a foreign trip or kids marriage then you should invest for 3 - 5 years. This is mid term investment and you should go for hybrid funds.

If you need to invest for kids education or retirement then you should invest for 5 and more years. This is long term investment and you should go for equity funds.

The author is a blogger and likes to blog on the different mutual fund topics. Currently the author has explained the SIP investment plan details and the reasons to do an SIP.

Total Views: 76Word Count: 468See All articles From Author

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