If you are thinking of doing SIP (Systematic Investment Plan) in mutual funds, then this question must have come to your mind – does investing on a particular date give more returns?
Different research shows that the date of SIP does not have any significant effect on returns in the long run (8-10 years). Experts say that the most important thing is that you invest regularly. The date does not matter much, but it would be right to invest whenever you have funds available.
If you are thinking of starting investing in SIP, then here are some easy tips that can help you get better returns.
Why invest in SIP?
Big fund from small savings: The biggest feature of SIP is that you can create a good fund in the long run by investing a few thousand rupees every month.
Benefit of compounding: The longer you invest, the more your money will grow automatically.
Automatic investment from bank account: Once you set up SIP, the money will be automatically deducted on a fixed date every month, so that you will not have to worry about investing again and again.
Also read: Motilal Oswal’s 4 funds shine despite market crash – Check their 1-year returns
What things to keep in mind while investing in SIP?
- Complete KYC before starting SIP
To invest in SIP, first of all you have to complete the KYC (Know Your Customer) process. For this, it is necessary to provide Aadhar card, PAN card and address proof.
- On which date will it be better to do SIP?
The date of SIP does not matter much in the long run.
Experts, however, suggest that it may be better to choose the date of SIP after the 10th of every month.
The best way is to set SIP on the same date when there is sufficient balance in your bank account.
- Always keep sufficient balance in the bank account
SIP has an auto debit facility, that is, the money will be deducted automatically on a fixed date. If there is no money in the account, the bank can charge a penalty.
Keep a balance in your bank account before the date of SIP so that your investment can be done on time.
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