5 Mistakes You Can Avoid While Inve

by Personal FN Financial Advisor/Consultant

Last Saturday, Chaya, an old acquaintance called up to tell me that an article my colleague Divya wrote, How Stepping Up SIP Every Year Gives A Boost To Your Wealth, helped her to decide about investi

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SIP investing is like investing in a recurring deposit (RD) with a bank, where you deposit a fixed sum of money regularly (into your RD account) and reap the benefits from the market investments.

A SIP includes a series of consecutive payments of pre-determined amounts made after a defined period. It can be weekly, monthly, quarterly, or even yearly. This is a hassle-free way to invest in mutual funds and inculcate a regular savings habit.

[Read: Are SIPs Better Than Lumpsum Investments? Know Here...]

With the SIP mode of investment, your money is deployed in a mutual fund scheme (equity schemes and/ or debt schemes). But your investments are subject to market risk.

Chaya interrupted me, 'So, then what are the benefits of SIP investment?'

I explained that SIPs work on the simple principle of investing regularly in a disciplined manner that enables you to build wealth over a long period of time.