Dear Friend,
I need to confess something that most of us whisper in private: sometimes SIPs feel like a scam. Yes, it does feel a little dramatic to say it out loud, but hear me out.
Imagine this: You’ve invested with discipline every month for years. You’ve skipped that weekend trip, ignored the latest phone upgrade, and chosen SIP over instant gratification. Then one day, you open your portfolio, and instead of a rewarding green, you see a deep, bleeding red. That sinking feeling of losing money? I’ve been there too.
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Last April, my trusted midcap fell into a well. I almost hit Stop SIP. Today it’s back at 18% and I’m just glad I didn’t panic. But there are still days when I ask myself: Do SIPs even work?
If you’ve ever felt let down by your SIP, let me walk you through what I learned the hard way.
Myths I Believed (and How They Broke)
When I first began, I thought profits would show up from day one. Expectation: a smooth upward curve. Reality? The graph looked like a teenager learning how to drive. Zig-zag, unpredictable, messy. Only later did I realise: early years are chaotic, but the long run is where SIPs deliver.
And then came the real shock. I believed SIPs were bulletproof. But 51 equity SIPs out of 277 delivered –10% returns in the past year. Seeing that bright red number on my screen stung, but it also taught me that volatility is part of the game.
My next myth? Believing that just the “habit” of doing SIPs would make me wealthy. Truth is, SIPs are like a slow-cooked curry: they need time, quality ingredients (good funds), and patience. Research shows it takes at least 5 years for an SIP to stand an 80% chance of delivering decent returns. Checking too often didn’t change outcomes; it only stressed me out.
The Turning Point
I also assumed every fund was right for me. Wrong again. Over time, I reassessed my portfolio and added a mix of large and mid-cap funds for balance. Turns out, it wasn’t the habit alone, it was the quality of funds plus tenure that did the heavy lifting.
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