What is SIP for Beginners?
SIP is a method of investing a fixed amount in mutual funds every month. It’s perfect for beginners as it reduces the need to monitor the market every day and helps them earn returns through regular contributions.
- Insurance Companies
- Mutual Funds
|
Returns |
| Fund Name |
5 Years |
7 Years |
10 Years |
| Max Life |
27.23% |
21.07% |
|
| Tata AIA |
30.99% |
21.69% |
|
| Bajaj Allianz |
24.23% |
12.8% |
|
| HDFC Standard |
25.77% |
14.87% |
|
| Canara HSBC Oriental Bank |
17.51% |
10.29% |
|
| Bharti AXA |
23.03% |
15.02% |
|
| Birla Sun Life |
26.67% |
14.18% |
|
| ICICI Prudential |
22.68% |
13.38% |
|
| LIC |
- |
- |
|
| PNB Metlife |
24% |
16.86% |
|
Fund rating powered by
Last updated: May 2025
| |
Returns |
| Fund Name |
3 Years |
5 Years |
10 Years |
| QUANT |
23.92% |
31.48% |
|
| PARAG PARIKH |
20.69% |
26.41% |
|
| EDELWEISS |
22.34% |
24.29% |
|
| KOTAK |
24.64% |
25.01% |
|
| MIRAE ASSET |
19.74% |
24.32% |
|
| PGIM INDIA |
14.75% |
23.39% |
|
| DSP |
18.41% |
22.33% |
|
| CANARA ROBECO |
20.05% |
21.80% |
|
| SUNDARAM |
18.27% |
18.22% |
|
How to Start a SIP for Beginners?
Starting a SIP is straightforward. Here are the essential steps:
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Complete KYC Requirements:
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Gather necessary documents: PAN card, proof of address (Aadhaar, passport), and a passport-sized photograph.
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Complete KYC (Know Your Customer) formalities either online or at authorized banks or post offices.
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Choose a Mutual Fund:
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Research and select a mutual fund that aligns with your financial goals and risk appetite.
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Consider factors like past performance, fund manager reputation, and expense ratio.
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Register for an Account:
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Investment Amount and Frequency:
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Submit Your Application:
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Complete the registration process by submitting your application online or offline.
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If applying online, ensure you have an e-mandate set up for automatic transactions.
SIP Calculator
Monthly Investment
₹22.4 L
Top Funds with High Returns (Past 7 Years)
18.4%
High Growth Fund
17.46%
Top 200 Fund
14.57%
Accelerator Mid-Cap Fund II
14.81%
Opportunities Fund
10.58%
Growth Plus Fund
13.35%
Accelerator Fund
14.61%
Growth Opportunities Plus Fund
15.6%
Multiplier
11.48%
Equity Top 250 Fund
13.31%
Future Apex Fund
12.32%
Opportunities Fund
14.24%
Frontline Equity Fund
15.03%
Virtue II
10.88%
Pension Dynamic Equity Fund
11.8%
Equity Fund
10.32%
Blue-Chip Equity Fund
Points to Consider Before Investing in SIP
You should consider the following points before you start investing in a SIP plan:
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Investment Goals: Set clear financial goals to ensure your SIP investments are aligned with your objectives.
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Risk Tolerance: Assess your risk appetite to choose the right type of SIP (equity or debt) based on your comfort with market fluctuations.
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Time Horizon: Choose an investment period that suits your goal, as a longer duration can lead to better returns.
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Start Early: The earlier you invest, the more your money will grow due to the power of compounding over time.
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Amount to Invest: Decide a monthly investment amount that fits your budget without impacting daily expenses.
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Market Volatility: Be prepared for market ups and downs. SIPs average out your cost over time, reducing volatility’s impact.
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Regular Monitoring: Review your SIP’s performance periodically to ensure it aligns with your financial goals.
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Expense Ratio: Consider the fund’s expense ratio. Lower ratios generally result in better returns.
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Diversification: Spread your investments across different asset classes to reduce risk and ensure consistent returns.
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Tax Benefits: Tax-saving SIPs like ULIP or ELSS allow you to claim deductions under Section 80C of the Income Tax Act.
Key Benefits of Investing through SIP
The key benefits of SIP investment are listed below:
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Rupee Cost Averaging: SIPs average your investment cost, which helps reduce the effect of market volatility.
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Compounding Power: Starting early lets your investments grow through compounding, increasing wealth over time.
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Affordability: SIPs allow you to start with a small amount, making them accessible to everyone.
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Discipline: SIPs encourage consistent, disciplined investing, crucial for long-term wealth accumulation.
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Flexibility: You can easily adjust your SIP by increasing, decreasing, or pausing it based on your financial situation.
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Diversification: SIPs help diversify your investments across various asset classes, spreading risk.
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Tax Benefits: Tax-saving SIPs under Section 80C can reduce your taxable income.
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Automatic Investment: SIPs are automated, so you don't have to worry about timing the market.
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Reduced Timing Risks: SIPs remove the need to time the market, as they involve consistent, long-term investments.
