Skip to main content

How Does SIP Work?

 

How Does an SIP Work?

Systematic Investment Plan (SIP) is the buzzword among investors who are pouring in close to `5,000 crore into equity mutual funds through the SIP route every month. Experts say an SIP is the most effective way of investing, especially for retail investors.

Let's find out more about SIPs and how they work.

1. What is an SIP?


An SIP is a specific amount, in vested for a continuous period at regular intervals, generally on a monthly ba sis. Using this method, an investor buys units of a scheme at a pre-de cided frequency . SIPs, which help investors take part in the stock market, obviate the need to time the market, and also bring a disci pline to their invest ment methodology .

2. When can I start an SIP?


In an open-ended mutual fund scheme, you can start an SIP any time you want. Just fill up the application form along with an SIP mandate and submit it to the point of acceptance. It generally takes 10-30 days for the bank to reg ister your SIP mandate and start it. Some fund houses allow you to

3. For how long can you run an SIP?


Most fund houses stipulate a minimum of six months for an SIP . Investors can choose any tenure they wish or they may even opt for the `perpetual option', which means the SIP will continue till the investor gives an instruction to the fund house to close it. Financial planners suggest investors to link each SIP to a goal and continue with it till the goal is reached.

4. Can you change the SIP amount?


An investor can increase or re duce his SIP amount, by first cancelling the existing mandate and giving the revised one. Fund houses do not charge any penalty for stopping the SIPs.

5. Can I invest lumpsum in a scheme in which I have an SIP running?


Yes, you can add a lumpsum amount to the same scheme in which you are running an SIP. It does not affect the SIP.






Invest Rs 1,50,000 and Save Tax up to Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds. Save Tax Get Rich

For further information contact SaveTaxGetRich on 94 8300 8300

OR

You can write to us at

Invest [at] SaveTaxGetRich [dot] Com

OR

Call us on 94 8300 8300




 

Popular posts from this blog

L&T Growth

Invest in Mutual Funds Online Download Mutual Fund Application Forms   L&T Growth Fund (LTGF) is open-ended diversified equity fund that invests predominantly in large caps. LTGF follows the growth style of investing and has been in existence for over 10 years now.   Type of scheme Open-ended Category Diversified equity Sub-category Large Cap Style Growth Launch date September 17, 2001 Risk-Return proposition High risk-Average return   Investment Objective and Proposition The fund's primary investment objective is "generate long term capital appreciation income through investments in equity and equity related instruments; the secondary objective is to generate some current income and distribute dividend. However, there is no assurance that the investment objective of the scheme will be achieved." Following large cap ...
Read more

Mutual Fund Exit Load Changes

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300 Mutual Fund Exit Load Changes AMCs don't communicate about any change in exit load directly with investors, but do update on their website   The exit load applicable to your investments is the load which existed at the time when you invested in the particular fund. Any subsequent changes in the exit load will not be applicable to your investments.   However, Asset Management Companies ( AMCs ) periodically publish addendums in the newspapers, which state any change in exit loads of specific schemes managed by them. Such changes are also posted on their websites. However, a direct communication to an investor is not made, considering the costs involved in doing so. In their own interests, investors should not only track the performance of the funds they i...
Read more

Equity ETFs vs Diversified Equity Mutual Fund

Invest in Mutual Funds Online Download Mutual Fund Application Forms   The importance of being active couldn't have been explained better. To put it simply, one needs to be active in his or her daily life, if one desires to succeed. An active mind always helps in making sound decisions which otherwise (if you are not active) could lead to chaotic situations (one does not make the right decision). On the other hand if you remain passive (i.e. not active) in whatever you do, you will surely see yourself at the losing end.   Now, that you are aware of how important it is to be active, make sure that your investments are active in generating long term growth in order to make you wealthy as well as healthy.   While investing in mutual funds too, you investors need to be careful while selecting the right mutual funds according to your ability to bear risks. You need to keep in mind that while there are mutual fund schemes which are actively managed in order ...
Read more

Reliance Money ties up with World Gold Council

Invest Mutual Funds Online Download Mutual Fund Application Forms   The World Gold Council in partnership with India Post and Reliance Money will provide a special discount of 6 per cent to buyers of gold coins on Akshaya Tritiya on April 24. --------------------------------------------- Invest Mutual Funds Online Transact Mutual Fund Online   Download Mutual Fund Application Forms from all AMCs Download Mutual Fund Application Forms   Best Performing Mutual Funds Largecap Funds: DSP BlackRock Top 100 Fund ICICI Prudential Focused Blue Chip Fund Birla Sun Life Front Line Equity Fund Large and Midcap Funds ICICI Prudential Dynamic Plan HDFC Top 200 Fund UTI Dividend Yield Fund Mid and SmallCap Funds Reliance Equity Opportunities Fund DSP BlackRock Small & Midcap Fund Sundaram Select Midcap IDFC Premier Equity Fund Small and MicroCap Funds DSP BlackRock...
Read more

Debt Mutual Fund Dividends are Taxable

DDT is deducted when a non-equity fund declares dividends. Equity and balanced fund dividends are tax-free The AMC is correct to deduct the dividend distribution tax (DDT) as it is mandated by tax laws. DDT in mutual funds is deducted every time a non-equity fund declares dividends. Equity fund and balanced fund dividends are tax-free . It is possible that you have invested in a non-equity fund for the first time or have received the dividend under a non-equity fund for the first time. That is why this is the first occasion when you have come across DDT.   The rate at which non-equity schemes deduct DDT has also gone up after the July 2014 budget. This is due to a change in calculation methodology. Earlier, if the fund has to declare a dividend of R 100, it used to make a provision for R 128.3, paying R 28.3 to the taxman and distributing the balance to the investor. This allowed the investor to bear less tax since the effective tax rate was 22.07 per ce...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now