UTI SIP

UTI SIPs, offered by UTI Mutual Fund, a leading investment house in India, are a smart and convenient way to invest money. SIP stands for Systematic Investment Plan, allowing you to invest a fixed amount of money regularly (monthly, quarterly) into a chosen UTI mutual fund or other fund schemes.

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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

What are UTI SIPs?

UTI SIPs refer to Systematic Investment Plans offered by UTI Mutual Fund, one of India's leading asset management companies. SIPs are a popular way to invest in mutual funds and other fund schemes by setting up a fixed amount for regular investment.

Here's what UTI SIPs are:

  • Systematic Investment: You invest a fixed amount at chosen intervals (monthly, quarterly, etc.) into a UTI fund scheme.

Benefits:

  • Disciplined Investing: It builds a habit of regular saving and avoids the need to time the market.

  • Rupee-Cost Averaging: By investing at regular intervals, you purchase units at different Net Asset Values (NAVs), potentially averaging out the cost per unit over time.

  • Flexibility: You can start with a minimum amount (often Rs. 500) and choose the investment tenure and SIP amount as per your goals.

UTI offers an SIP calculator to help you estimate potential returns based on your SIP amount, investment horizon, and expected rate of return. You can explore Policybazaar’s website or consult a financial advisor to learn more about specific UTI SIP plans and choose one that aligns with your financial goals.

What are the Benefits of Investing in UTI SIPs?

Below mentioned are the advantages of investing in UTI SIPs:

  • Disciplined Investment:  UTIs SIPs build a habit of regular saving.  Instead of needing a large lump sum to invest, you can set up a fixed, automated contribution, ensuring consistent investment towards your financial goals.

  • Rupee-Cost Averaging: This is a powerful benefit of SIPs. By investing at regular intervals, you purchase units at different market prices. When the market is high, you buy fewer units, and vice versa. This helps average out the cost per unit over time, lowering the risk of market volatility.

  • Flexibility: UTI SIPs offer great flexibility. You can start with a minimum amount, as low as Rs. 500, making it easy for many investors. You also have control over the SIP amount and investment tenure, allowing you to personalise the plan to your financial goals and budget.

  • Power of Compounding:  When you earn returns on your investment, those returns are then reinvested and also earn returns. This compounding effect can grow your wealth over the long term, especially with consistent investments through SIPs.

  • Potential Tax Benefits:  Some UTI SIP plans, particularly Equity Linked Savings Schemes (ELSS), offer tax benefits under Section 80C of the Income Tax Act in India. You can claim deductions on your taxable income for your SIP contributions.

How Does UTI SIP Investment Work?

  • Invest a fixed amount at chosen intervals (monthly, quarterly) into a UTI mutual fund scheme.

  • The chosen amount is automatically deducted from your bank account at each interval.

  • You receive units based on the current Net Asset Value (NAV) of the fund.

  • Regular investments at different NAVs can potentially average out the cost per unit.

  • Choose your investment amount, tenure, and start/stop investing anytime.

Illustration

Imagine you decide to invest Rs. 1,000 every month in a UTI Fund scheme via SIP.

  • Month 1: NAV is Rs. 10. You purchase 100 units (1,000 Rs./10 Rs. NAV).

  • Month 2: NAV increases to Rs. 12. You purchase 83.33 units (1,000 Rs./12 Rs. NAV).

This way, you keep buying units at different NAVs. Over time, this could help average out the cost per unit, potentially benefiting you in the long run.

How to Calculate Returns on UTI SIP Investments?

To calculate returns on UTI SIP investments, use an SIP calculator available on Policybazaar’s website. An SIP calculator is an online tool used to estimate potential returns on investments made through SIPs. The calculator will generate results based on the parameters provided. Analyze these projections to understand potential growth over time, adjusting parameters as needed. Use the calculator to align your investment strategy with financial goals and risk tolerance. 

FAQs

  • What are the documents required to invest in UTI SIP Plans?

    To invest in the UTI SIP Plan, the investors need to submit the below-mentioned documents:
    • Complete the process of registration and Know Your Customer (KYC) process.

    • Address proof documents.

    • Submit the Aadhar Card and PAN card.

  • Is UTI SIP good?

    It can be considered a good SIP. The Fund Performance has been as follows:

    The annualized returns for the last 3 years & 5 years have been around 22.33% & 15.8%.

  • Can I invest 2000 rupees in SIP?

    Yes, you can invest 2,000 rupees in a SIP. Many UTI SIPs and SIPs offered by other fund houses allow you to start with a minimum investment amount as low as Rs. 500. So an investment of Rs. 2,000 would be well within the acceptable range.

+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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