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Why SIP Makes Sense

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How Does SIP Work ?

Once you apply for one or more SIP plans, the amount is automatically debited from your bank account and invested in the mutual funds you have
purchased at the predetermined time interval.
With every investment in an SIP plan in India, the additional units are added to your account depending on the market rate. With every investment, the amount being reinvested is larger and so is the return on those investments.

Types of SIP

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Top Up SIP

The Top-up SIP allows you to increase your investment amount periodically giving you the flexibility to invest higher when you have a higher income or available amount to be invested. This also helps in making the most out of the investments by investing in the best and high-performing funds at regular intervals.

Flexible SIP

As the name suggests, Flexible SIP xplan carries flexibility of the amount you want to invest. An investor can increase or decrease the amount to be invested as per his own cash flow needs or preferences.

Perpetual SIP

A perpetual SIP Plan allows you to carry on the investments without an end to the mandate date. The investor can hence withdraw the amount invested whenever he wishes or as per his financial goals. -

FAQs about SIP work

SIP, or Structured Investment Plan, is a systematic method of investing a fixed sum regularly in financial instruments such as mutual funds or other investments.

SIPs offer benefits such as disciplined investing, rupee cost averaging, and the power of compounding, making them a preferred choice for long-term financial goals.

  • Allows small and regular investments.
  • Reduces risk by averaging market volatility.
  • Encourages disciplined savings habits.

SIPs can typically be started with as low as ₹500 per month, depending on the mutual fund scheme.

  • Equity mutual funds: Gains held for over 1 year are taxed at 10% (if gains exceed ₹1 lakh); gains held for less than a year are taxed at 15%.
  • Debt mutual funds: Gains are taxed based on the holding period.