Best SIP Plans for 500 per Month

Investing through a Systematic Investment Plan (SIP) allows you to build wealth gradually by contributing a small SIP of Rs. 500 per month regularly and gain access to the best market-linked funds known for their growth potential, stability, and diversification. Let us explore the best SIP plans available for just 500 monthly rupees.

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SIP Benefits
Start SIP with as low as ₹1000
Start SIP with as low as ₹1000
No hidden charges
No hidden charges
Save upto ₹46,800 in Tax
Save upto ₹46,800 in Taxunder section 80 C
Zero LTCG Tax
Zero LTCG Tax^ (Unlike 10% in Mutual Funds)
Disciplined & worry-free investing
Disciplined & worry-free investing

  • Insurance Companies
  • Mutual Funds
Returns
Fund Name 3 Years 5 Years 10 Years
Top 200 Fund Tata AIA 23.15% 27.3%
19.47%
View Plan
Virtue II PNB Metlife 21.78% 23.76%
17.76%
View Plan
Pure Equity Birla Sun Life 18.83% 19.17%
16.34%
View Plan
Growth Opportunities Plus Fund Bharti AXA 17.85% 18.97%
15.65%
View Plan
Pure Stock Fund Bajaj Allianz 17.49% 18.39%
15.52%
View Plan
Blue Chip Fund HDFC Standard 14.09% 14.83%
12.85%
View Plan
Growth Super Fund Max Life 14.38% 15.26%
12.72%
View Plan
Multi Cap Growth Fund ICICI Prudential 15.63% 13.98%
12.51%
View Plan
Equity Fund SBI 14.73% 14.91%
12.42%
View Plan
Growth Plus Fund Canara HSBC Oriental Bank 12.78% 12.27%
10.7%
View Plan

Updated as of May 2024

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  Returns
Fund Name 5 Years 10 Years RSI
Active Fund QUANT 27.80% 23.96%
21.08%
Large and Mid Cap Fund QUANT 23.27% 22.69%
19.64%
Flexi Cap Fund PARAG PARIKH 23.90% 20.22%
20.15%
Large and Mid Cap Fund EDELWEISS 20.32% 18.01%
16.76%
Equity Opportunities Fund KOTAK 20.22% 18.98%
17.44%
Large and Midcap Fund MIRAE ASSET 21.11% 24.56%
23.01%
Flexi Cap Fund PGIM INDIA 21.48% -
15.13%
Flexi Cap Fund DSP 19.48% 17.73%
15.82%
Emerging Equities Fund CANARA ROBECO 18.91% 22.92%
20.84%
Focused fund SUNDARAM 18.22% 16.55%
15.16%

Updated as of May 2024

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What are SIP Plans?

A SIP, or Systematic Investment Plan is a way to invest in market-linked funds in small and fixed amounts regularly—often monthly. These funds are offered by the mutual fund houses through the best mutual fund schemes in India. The insurance companies allow you to invest in the SIP plans under Unit Linked Insurance Plans (ULIPs), Annuity Plans, or Child Plans.

SIP investment helps you build wealth over time with the benefit of rupee-cost averaging, which reduces the impact of market ups and downs. SIPs are flexible; you can start with small amounts, increase contributions, or even pause them if needed. They are a convenient way to grow your savings and reach financial goals.

NOTE:

The ULIP funds offer the best SIP plans starting with a minimum amount of Rs. 1,000 per month. These plans provide you with high returns through market-linked investments along with a life cover for the financial security of your family. 

List of Best SIP Plans for 500 per Month in India in 2024

The best SIPs to invest Rs. 500 per month in India, allow you to start investing regularly and benefit from the principle of compounding and rupee-cost averaging. 

The following list is sorted as per the top-performing SIP for Rs. 500 per month for 5 years:

SIP Investment in India Net Asset Value (NAV)* Fund Size (in Crores) 3-Year Returns 5-Year Returns 10-Year Returns
Invesco India PSU Equity Fund Direct-Growth Plan ₹67.65 ₹859 Crores 41.16% 29.11% 20.89%
Nippon India Index Fund S&P BSE Sensex Plan Direct-Growth Plan ₹39.2 ₹635 Crores 16.29% 14.85% 13.32%
Franklin India Feeder Franklin US Opportunities Direct Fund-Growth Plan ₹68.67 ₹3,616 Crores 5.1% 15.15% 15.24%
SBI Technology Opportunities Fund Direct-Growth Plan ₹194.02 ₹3,668 Crores 17.88% 22.38% 18.56%
UTI Value Fund Direct-Growth Plan ₹151.92 ₹8,578 Crores 20.4% 18.86% 15.27%
Tata Equity PE Fund Direct-Growth Plan ₹351.4 ₹7,301 Crores 26.23% 20.13% 19.66%
Motilal Oswal Focused Fund Direct-Growth Plan ₹49.5 ₹1,804 Crores 14.95% 16.16% 15.82%

*NAV as of 25 April 2024

Details of Some of the Best SIP Plans for 500 per Month

  1. Invesco India PSU Equity Fund Direct-Growth Plan

    Invesco India PSU Equity Fund Direct-Growth Plan is a mutual fund scheme offered by Invesco Mutual Fund. It is an equity fund that invests primarily in Public Sector Companies (PSUs) in India.

    Features of Invesco India PSU Equity Fund Direct-Growth Plan:

    • Investment Objective: To generate capital appreciation by investing in equity and equity-related instruments of companies where the Central/State Government(s) has a majority shareholding or management control or has powers to appoint a majority of directors.

    • Lock-in Period: None

    • Age of Fund: 11 years, 3 months (since January 1, 2013)

    • Benchmark Index: S&P BSE PSU TRI

    • Minimum Investment: ₹500 for SIP; ₹1000 for lump-sum

    • Risk Level: Very High

    • Short-term Capital Gains (STCG): 15% tax if you sell within 1 year

    • Long-term Capital Gains (LTCG): 10% tax on gains exceeding ₹1 lakh per financial year after 1 year.

  2. Nippon India Index Fund S&P BSE Sensex Plan Direct-Growth Plan

    Nippon India Index Fund S&P BSE Sensex Plan Direct-Growth Plan is a passively managed index fund offered by Nippon India Mutual Fund. It tracks the performance of the S&P BSE Sensex, which is a benchmark index of the Indian stock market.

    Features of Nippon India Index Fund S&P BSE Sensex Plan Direct-Growth Plan:

    • Investment Objective: Replicate the composition of the Sensex, with the aim of generating returns that are commensurate with the performance of the Sensex.

    • Lock-in Period: None

    • Fund Age: 11 years, 3 months (since January 1, 2013)

    • Benchmark Index: S&P BSE Sensex TRI

    • Minimum Investment: ₹500 for SIP; ₹5000 for lump-sum

    • Risk Level: Very High

    • Short-term Capital Gains (STCG): 15% tax on profits if you sell within 1 year

    • Long-term Capital Gains (LTCG): 10% tax on profits exceeding ₹1 lakh in a financial year if held for over 1 year.

  3. Franklin India Feeder Franklin US Opportunities Direct Fund-Growth Plan

    The Franklin India Feeder Franklin US Opportunities Direct Fund-Growth Plan is a mutual fund scheme offered by Franklin Templeton Mutual Fund that invests in the Franklin US Opportunities Fund, a US-based equity fund. It is a feeder fund, which means it invests in another fund rather than directly in stocks.

    Features of Franklin India Feeder Franklin US Opportunities Fund Direct-Growth Plan:

    • Investment Objective: To invest in equity and equity-related instruments of companies in the US which have the potential for capital appreciation

    • Lock-in Period: None

    • Fund Age: 11 years, 3 months (as of January 1, 2013)

    • Benchmark Index: Russell 3000 Growth

    • Minimum Investment for SIP: ₹500

    • Risk Level: Very High

    • Short-term Capital Gains (STCG): Taxed at 15% if you sell within 1 year

    • Long-term Capital Gains (LTCG): 10% tax on gains exceeding ₹1 lakh per financial year if you hold for over 1 year.

  4. SBI Technology Opportunities Fund Direct-Growth Plan

    The SBI Technology Opportunities Fund Direct-Growth Plan is a mutual fund scheme offered by SBI Mutual Fund. It is an equity scheme that invests in a diversified portfolio of equity and equity-related securities of companies in the technology and technology-related sectors.

    Features of SBI Technology Opportunities Fund Direct-Growth Plan:

    • Investment Objective: Aims to provide long-term capital appreciation by investing in technology and technology-related companies.

    • Lock-in Period: None

    • Fund Age: 11 years, 3 months (since January 1, 2013)

    • Benchmark Index: S&P BSE Teck TRI

    • Minimum Investment: ₹500 for SIP; ₹5000 for lump-sum

    • Risk Level: Very High

    • Short-term Capital Gains (STCG): 15% tax if sold within 1 year

    • Long-term Capital Gains (LTCG): 10% tax on returns over ₹1 lakh per financial year after 1 year.

  5. UTI Value Fund Direct-Growth Plan

    UTI Value Fund Direct-Growth Plan is a value-oriented equity mutual fund scheme offered by UTI Mutual Fund. It invests predominantly in equity and equity-related securities of companies across the market capitalization spectrum. 

    Features of UTI Value Fund Direct-Growth Plan:

    • Investment Objective: To generate long-term capital appreciation by investing in undervalued stocks that the fund manager believes have the potential for future growth.

    • Lock-in Period: None

    • Fund Age: 11 years, 3 months (since January 1, 2013)

    • Benchmark Index: NIFTY 500 TRI

    • Minimum Investment: ₹500 for SIP; ₹5000 for lump-sum

    • Risk Level: Very High

    • Short-term Capital Gains (STCG): 15% tax on gains if sold within 1 year

    • Long-term Capital Gains (LTCG): 10% tax on gains above ₹1 lakh in a financial year after 1 year of holding

Factors to Consider Before Investing in Best SIP Plans for 500 per Month

Some important factors to consider before choosing the best SIP Plan for 500-per-month contributions in India are listed below:

  1. Risk Tolerance:

    • This is how comfortable you are with the possibility of losing money on your investment. 

    • Equity SIPs offer potentially higher returns but come with more risk of short-term fluctuations. 

    • Debt SIPs are generally considered less risky but also offer lower returns.

  2. Investment Goals:

    • Plan your investments as per your financial goals. 

    • A short-term goal (within 3 years), like a down payment on a gadget, might be better suited for a debt SIP investment. 

    • Long-term goals (5 years or more) like retirement could benefit from an equity SIP investment for potentially higher growth.

  3. Investment Horizon:

    • Enquire for how long you want to stay invested in the best SIP Plan, as SIPs are meant for long-term investing. 

    • The longer the investment horizon, the more time you ride out market fluctuations and benefit from potential compounding returns in equity SIPs.

  4. Expense Ratio:

    • This is a fee charged by the insurance company or mutual fund house to manage the SIP. 

    • Lower expense ratios mean more of your money goes towards investment.

  5. Fund Performance:

    • Look at the fund's past performance, but remember past performance does not guarantee future results. 

    • Look for funds with a consistent track record of performing well compared to their benchmark index.

    • Make use of a SIP calculator to estimate your returns from the investments in the best SIP for 500 per month.

In Conclusion

Investing in the best SIP plans for Rs. 500 per month can be a great start to building long-term wealth. Look for SIP investments with low expense ratios and a proven track record of performance. Consider diversifying across different types of funds, such as equity, debt, or hybrid funds, based on your risk tolerance and financial goals. While the amount may seem modest, the discipline of regular investing can yield significant returns over time due to the power of compounding. 

FAQs

  • What are SIPs?

    Systematic Investment Plans (SIPs) allow you to invest a fixed amount in a market-linked fund scheme at regular intervals. It is a disciplined approach to building wealth gradually.
  • Can I really start an SIP with just ₹500 per month?

    Yes. Many mutual fund companies offer SIPs with a minimum investment of as low as ₹500, making it accessible for everyone.
  • What factors should I consider when choosing an SIP plan?

    Consider your financial goals (retirement, child's education, etc.), risk tolerance (how comfortable you are with market fluctuations), and investment horizon (how long you plan to invest) before investing in the best SIP plan for Rs. 500 per month.
  • How long should I invest through an SIP?

    SIPs are for long-term wealth creation. Ideally, invest for at least 5-7 years or longer to ride out market ups and downs and benefit from compounding.
  • Can I change my SIP amount or stop it midway?

    Yes, most platforms offer SIP flexibility. You can increase, decrease, or pause your SIP contributions as per your needs.
  • Is it safe to invest in SIPs?

    Market-linked funds are subject to market risks so investment values can fluctuate. However, SIPs help average out the cost per unit over time (rupee-cost averaging) and potentially mitigate risk.

+For Mutual Fund midcap category Returns https://www.morningstar.in/tools/mutual-fund-category-performance.aspx & for Insurance midcap fund category Returns- https://www.morningstar.in/tools/insurance-fund-category-performance.aspx
*Past 10 Year annualised returns as on 01-12-2023
*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply
^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
~Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.

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