WHAT INVESTMENT WOULD YOU THINK WILL GIVE YOU BEST RETURNS?

WHAT IS SYTEMATIC INVESTMENT PLAN?

A Systematic Investment Plan or SIP is a smart and hassle free mode for investing money in mutual funds. SIP allows you to invest a certain pre-determined amount at a regular interval (weekly, monthly, quarterly, etc.). A SIP is a planned approach towards investments and helps you inculcate the habit of saving and building wealth for the future.

HOW DOES IT WORKS

A SIP is a flexible and easy investment plan. Your money is auto-debited from your bank account and invested into a specific mutual fund scheme.You are allocated certain number of units based on the ongoing market rate (called NAV or net asset value) for the day.

Every time you invest money, additional units of the scheme are purchased at the market rate and added to your account. Hence, units are bought at different rates and investors benefit from Rupee-Cost Averaging and the Power of Compounding.

POWER OF COMPOUNDING

Due To The Power Of Compounding The Money That You Inested Will Give A Profit% Of 15%-20%

The More years You Invest More Beneifit Is For You.

However, if you started investing 10 years earlier, your Rs. 10000 each month would add up to Rs. 36 lakh over 30 years. Assuming the same average annual growth of 7%, you would have Rs. 1.22 Cr on your 60th birthday - more than double the amount you would have received if you had started ten years later!

Other Benefits of Systematic Investment Plans

· Disciplined Saving - Discipline is the key to successful investments. When you invest through SIP, you commit yourself to save regularly. Every investment is a step towards attaining your financial objectives.

· Flexibility - While it is advisable to continue SIP investments with a long-term perspective, there is no compulsion. Investors can discontinue the plan at any time. One can also increase/ decrease the amount being invested.

· Long-Term Gains - Due to rupee-cost averaging and the power of compounding SIPs have the potential to deliver attractive returns over a long investment horizon.

· Convenience - SIP is a hassle-free mode of investment. You can issue a standing instruction to your bank to facilitate auto-debits from your bank account.

(mutual funds are subject to market risk)

BENEFITS OF SIP

   Why is SIP a Smart choice?

• Helps in inculcating financial discipline
• Helps you put investments on your priority list
• Average out your cost of investment and hence reduce your risk                                                 
• Helps in compounding your wealth

BENEFITS OF SIP:

Regular Investing

• Identify your financial goals like buying a house, your first car, marriage, education.
• Set aside and invest a fixed sum of money regularly to meet these financial goals.
• Become a disciplined investor – maintain regularity.
• A SIP will ensure all these for you.

Maintain discipline in your asset allocation

• SIP helps avoid the temptation of jumping from one asset class to another during certain market conditions.

Rupee Cost Averaging

• By investing a fixed sum at fixed intervals we can buy fewer units when the price is higher and more units when the price is lower. This is called Rupee Cost Averaging.

• SIP takes care that your average price works out to be lower than the price you would have paid at the market peak. It takes care that you invest across market cycles. Your average price works out to be lower than investing at the market peak. It helps you avoid the temptation of timing your investments “Market Timing” is best left to professionals.

The Power of Compounding

• Instead of saving a huge chunk of money and investing it in a lump sum investment, it is better to invest regularly in smaller amounts. The reason being while your lump sum investment may attract returns it does not give you the benefit of compounded interest that happens in SIP investment. With an SIP investment your investment grows and also your interest earns interest

(mutual funds are subject to market risk)