Understanding SIP: Your Complete Guide

What is a Systematic Investment Plan (SIP)?

A Systematic Investment Plan (SIP) is a method of investing where you make regular, equal payments into a mutual fund or other investment vehicle at fixed intervals. This systematic approach to investing helps in building long-term wealth through disciplined investing.

Key Benefits of SIP

  • Rupee Cost Averaging
  • Power of Compounding
  • Financial Discipline
  • Flexibility in Investment

How Does SIP Work?

When you start a SIP, a fixed amount is automatically deducted from your bank account and invested in your chosen mutual fund scheme on a specific date each month. This automated process ensures investment discipline and helps you avoid the pitfalls of market timing.