How to start a mutual fund SIP?

Financial planning has an important place in the lives of those who wish to attain financial stability. If you strive towards financial success, you should have a plausible financial plan. Now do not get overwhelmed by the term financial planning. It may sound like a complex term, but in reality, it isn’t. Money management is the key to making an effective financial plan. If you do not know how to control your expenses with your monthly income, which is the first thing you should focus on. Because savings is a crucial part of financial planning. Say you want to buy a weekend home when you retire. Now, this may be an achievable goal. You are also emotionally attached to this goal because it will be your lifelong dream to shift from the busy urban life and shift to a quiet country home after your retirement. However, to achieve this goal you will have to make sure that you save a decent amount of your monthly income and invest in a feasible scheme that may hold the potential to help you achieve this goal.

Investment is a lifelong journey, and if you wish to build a decent retirement corpus, or send your children abroad for overseas education or give your daughter a destination wedding she always wanted, you will have to invest a certain portion of savings regularly. And a mutual fund SIP can help investors inculcate a habit of regular investing.

The merits of mutual fund investments are that they offer investors diversification to their portfolio. Did you know that one unit of a mutual fund like equity fund consists of several company stocks? This is why those who wish to get a better understanding about the vagaries of the equity market consider investing in mutual funds. Mutual funds do not restrict their investments to equity markets. They invest in other debt and money market instruments as well. Depending on the nature of the scheme and its investment objective a mutual fund invests in securities like government bonds, debentures, fixed deposits, etc.

What fund houses do is that they collect money from investors sharing a common investment objective and invest this money in .

We spoke about SIP earlier, now we will focus on it in detail. A Systematic Investment Plan (SIP), is a method of investing in mutual funds. SIPs are generally preferred by those who wish to achieve long term financial goals. Investments in SIPs have several benefits like rupee cost averaging and the power of compounding. If you are looking to fulfil your long term financial goals, you can consider starting a mutual fund SIP. With SIP, investors get to choose an amount they are comfortable investing on various frequencies The money is auto-debited from the investor’s savings account with one time mandate functionality and electronically transferred to the mutual fund, thus saving them from the hassles of visiting the fund house manually to carry on with their monthly investments.

How to invest in mutual funds via SIP?

Finding SIP a feasible investment option? Keen on making an investment in mutual funds through SIP? Do not worry, we will tell you exactly what you need to do to start SIP in mutual funds. Firstly, investors need to make sure they are KYC (Know Your Customer) compliant. KYC is a mandate that all fund houses ask their investors to complete before investing in mutual funds.

It generally takes a few days for KYC verification process. As soon as you get a message from the fund house that you are a KYC compliant individual, you can now start investing in mutual funds via SIP. You can visit the fund house’s website online and start a mutual fund SIP by visiting the SIP page.

Mutual fund investments are subject to market risk read all scheme related documents carefully.