SIP — Systematic
Investment Plans

Most mutual fund schemes allow SIP investments starting from ₹500 per month. There is no upper limit. The right starting amount depends on your goals and income — our advisors can help you determine the optimal SIP amount for each of your financial goals through a free consultation.

Yes — SIPs can be paused, modified, or stopped at any time. Most fund houses allow pausing for 1–3 months without cancellation. If you stop the SIP, your existing investments continue to remain invested (or can be redeemed separately). Exit loads may apply if you redeem units within a year of purchase — typically 1% for equity funds. We recommend pausing rather than stopping during periods of financial stress, as stopping can significantly impact long-term outcomes.

A Regular SIP invests the same fixed amount every month for the tenure. A Step Up SIP automatically increases the monthly investment amount by a fixed percentage (e.g. 10%) every year. Over 20 years, a Step Up SIP of ₹10,000/month (growing at 10% annually) builds approximately ₹1.83 crore vs ₹99.9 lakh from a regular SIP — at the same 12% assumed CAGR. The difference is dramatic because both your investment amount and your returns compound simultaneously.

There is no fixed rule — the number of SIPs should be driven by the number of distinct financial goals you have. A good starting structure might include: one SIP for retirement (long-term, equity-heavy), one for an emergency fund (short-term, liquid), and one for a specific goal like children's education or a home down-payment. Each goal gets a dedicated SIP in the right fund category. We typically help clients structure 3–5 SIPs covering their most important goals.

SIP taxation works on a FIFO (First In, First Out) basis — each SIP instalment is treated as a separate purchase. For equity mutual funds: gains on units held for less than 12 months are taxed at 20% STCG. Gains on units held beyond 12 months above ₹1.25 lakh threshold are taxed at 12.5% LTCG. For debt mutual funds: gains are taxed as per your income tax slab, regardless of holding period (applicable for units purchased after April 2023). ELSS funds provide 80C tax deduction up to ₹1.5L annually. Please consult a tax advisor for personalised guidance.

Market crashes are one of the best times to have a SIP running. Your fixed monthly investment buys significantly more units when prices are low — this is the rupee-cost averaging effect. Historical data shows that investors who continued their SIPs during the 2008 financial crisis and 2020 COVID crash saw dramatically superior returns compared to those who paused or stopped. The key principle is: do not stop your SIP during a market correction — if anything, it is the time when SIP works hardest for you.