Systematic
Investments are one of the trendiest topics in the markets with people assuming
a hot of hearsay rather than just believing on the facts. If one goes by the
book SIP (Systematic Investment Plan) is
just method of investment over time period that you find suitable. Although
there are certain rules and specific requirements that are presented by
particular bank the fundamental remains the same for all banks that is ruled by
SEBI (Securities and Exchange Board of India) and AMFI (Association of Mutual
Funds in India)
Now
there are very common misconceptions that are talk of the people that we will
be busting today.
1.
SIP works for Small investors only: It is common in
the market to assume that SIP works mostly for small investors as the initial
amount that one can set can be low as Rs 1000 per month. But the whole system
is built to scale as per you invest more and more the process remains the same.
SIP offers long time future benefits that are available for small investor as
well as large investors in this market respectively. One thing is sure there
are initial hiccups and certain rules that
2.
Lump Sum Investments: There is hearsay that if one
is committed in the SIP’s regular plan then you can’t invest in lump sum
investment. It is completely wrong one can easily add the lump sum account to
your current Mutual Fund SIP and it will be added as per regulations without
any issues. And there are similar problems for people who think only rich can
invest in these SIP as one can start as low as Rs500 per month that will act as
future investment for family. SIP return ratio over long term is much better
than FD or any other schemes that Bank offers.
3. No
Commitments Rule: Missing one or two months SIP
still there are no punishments or whatsoever it’s just your money as well
investments. It is completely opposite from the EMI scheme that we adhere to
while paying loan amounts. Even though you committed for 10-15 years so you can
readjust as per your current scenarios. You can stop, terminate and extend at
your desires. Although in Indian market there are limitations for minimum three
years for tax bounded mutual funds.
4. SIP
and Market effect: Most often it is thought that if
markets are high SIP’s should not be started at all. Well truly SIP with its
systematic approach protects the investment from market so one can start at
anytime with right guidance in the beginning that corresponds to his present
financial status. Markets are known to have unpredictable nature but SIP’s are
fundamentally the perfect way to invest for future returns.
5. Fixed
Incomes related schemes are better with security: Most
of the investors have this mind set if they have Fixed Income there income is
better guaranteed but the truth of the matter is it quite low. With SIP using
similar growth and trends you can have much more future returns. For example Rs
50,000 investment will become around 57,000 in 5year FD while if you manage to
do the similar Rs1000 per month SIP for next 5 years the end result will be
around Rs 80,000 that makes it whole lot of difference.
One has to realise these funds are invested
in markets and there are chances of losing so one must create breakeven points
if goes lower than this I am going to withdraw the investment. This is where
you need to have right guidance with experts who are in the market itself. Wealthcare
Securities Pvt Ltd is certified private Wealth Management firm who for last
five years has established itself as the spearhead for Financial Planning Services.
Our main strength lies in Financial and Wealth Management including all the
taxes, funds as well as securities. We also provide right guidance for child
education and retirement planning that will benefit your future goals too. Systematic
investments are one of the best ways forward in these hard competitive markets
and with our services you can start looking for future dreams.
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