How SIP Investment Plan Will Help To Meet Your Fiscal Goals?

Everyone has got aspiration in life that acts as the driving force of working harder as well as dream bigger. Such aspirations define both short & long-term aims of life as well as propel us in planning many different financial decisions. It pays to set the goals and begin planning quite early in life. While doing so, one will go away with plenty of monetary stress as well as focus on finer aspects of life. Whether it is short-term goals such as going for the vacation, renovation and long-term aspirations such as owning a luxury car, purchasing property, kids’ education, retirement planning, and marriage, and more - they all need timely & dedicated SIP investment plan.
There are many investment options that are available in the financial market one may choose from. That depends on the person’s financial targets and time horizon, the advisors guide people to invest in the appropriate funds. But, besides deciding the kind of investment it is important to check out whether one will invest in the lump sum or form of the regular and small installments.
SIP investment plan is one highly recommended choice for investing in mutual funds. It’s the systematic, disciplined and regular investment vehicle for achieving respective financial targets wherein, investor assigns the regular amount of money to get invested on the weekly, monthly and quarterly basis. So, besides instilling this habit of savings, the SIP investment plan offers many other benefits also. Let us have a close look at some key benefits of investing through SIP Investment Plan:
Convenient – The SIP investment plan is quite simple & convenient to set up. You just have to pick the scheme, amount that you would like to invest and date, and automatically money is debited from your bank account periodically.
Flexible – One may start investing from Rs 500 and may pause, stop or resume their SIP investment plan as per their convenience as well as depending on their financial commitments. In addition, all this will be done on the internet without physically taking out time to visit any branch.
Discipline – SIP investment plan makes sure that investor is invested in this market as well as gets benefitted from best days since they are automated.
Rupee cost average – The SIP investment plan offer benefit of the rupee cost averaging. It means that the investor is allocated some more units of their mutual fund scheme while the market falls or fewer units when the market increases. It ensures that overall investment cost will be averaged out & eliminates the need to time this market.
Power of compounding –The biggest advantage of the early investment via SIP investment plan is the opportunity of leveraging the power of compounding. The power of compounding will be like the snowball effect, which generates good returns on investments and returns generated till now in your Kotak mutual fund investment. This will lead to significant corpus while invested for the long-term. Under the power of compounding, higher the investment tenure more is the power of compounding.
Kotak Mutual fund has come up with their SIP investment plan that aims to encourage the people of developing the habit of savings as well as start investing in the systematic & flexible way in this mutual fund industry. The concept of Kotak SIP investment plan specifies there are various SIPs for the different financial goals as well as it pays to have investments to be tailor-made and meet your respective goals. One should assess their financial goals before they start investing and must preferably consult the financial advisor before making any kind of investment.
What are the benefits & highlights of the SIP investment plan?
       In SIP investment plan investor may choose their mutual fund company & sip plans that are based on the risk profile & return expectations according to the individual needs. There’re many options that are available in every risk profile and will get enrolled very easily for the specific time frame that the investor wants.
       Suppose investor would like to achieve the specific target amount & will spare a little amount on a monthly basis, SIP investment plan scheme offers the right opportunity of doing so. Normally, SIP investment plan will be kept for 3 years of the time where one may expect higher returns compared to the Term deposit and Bonds and other kinds of the options in their investment horizon.
       The good investor must distribute their earnings in the distinct investment options like Kotak Mutual funds, Term Deposits, Bonds, etc. Every scheme has got its pros & cons. But, while it comes about SIP investment plan and Lump sum purchase of mutual funds, it has distinct advantages as well as higher returns since it has got linkage to the Share market volatility, Corporate, Money market, and Government bonds and more.
       There’re a few options in the mutual funds that are accessible that pays you the monthly and regular dividend that is based on the accumulated units. It makes very good money on a regular basis. The advantage is quite more while you get the dividend on a regular basis as well as after maturity you may expect the capital appreciation as the current unit cost will be higher than the average purchase price.
Lowers average cost: The SIP investment plan work much better than one-time investing. It is due to the rupee-cost averaging. In rupee-cost averaging, the investor generally buys more of the mutual fund unit while prices are very low. Alternatively, he may buy lesser mutual fund units while prices are very high. It is the good discipline as it forces an investor to commit the cash at the market lows, while other investors are wary & exiting this market. Investors might also get pleased when the prices fall as fixed rupee investment will now fetch some more units

One more benefit, called the eighth wonder by some, is a power of compounding. While you invest over the long period & earn returns earned by the investment, your money will start compounding. It helps you build the large corpus, which helps you achieve the long-term financial targets with the regular SIP investment plan.

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