So, you may be confused between sip and lump sum investment? We are happy to help you strategically suits Indian family for best and how to align your financial goal.

SIP or Lumpsum: which one is strategically right for Indian?

when it comes to investing in a mutual fund, two popular option are there first one, the first one is systematic investment plan which is stand for sip and another one is lump sum investment. But which one is better for you? The final answer is depends on your financial goals, cash flow, risk tolerance and your budget habit.

for an Indian salad individual or a middle class families is making the right choice can significantly impact a long term wealth creation. In this article, we will breakdown that different and pros and ones and help you to choose a better strategy based on your unique situation.

What is SIP?

Systematic investment plan which is stands for sip is it disciplined investment approach where you invest a fixed amount regularly like monthly or quarterly in a mutual fund.

Advantages of SIP:

1. Best option for those who had a regular income like salary professionals.
2. Help to reduce rupee cost averaging market volatility risk.
3. Practicing habit of consistent saving.
4. Easy to start with a minimal amount Rs500/month.

Example

Ram, a software engineer in Kolkata who invest rupees 5000 per month via sip in an equity mutual fund for over 10 years, now assuming an annual return of 12%, after 10 years he is investment grows to over rupees 11 lakh!

Quick Tip – Use our free SIP Calculator to project your investment growth.

What is Lumpsum Investment?

A Lumpsum Investment stands for investing a large amount at once – the Lumpsum Investment is ideal when you have a windfall, bonus aur surplus cash.

Advantages of Lumpsum:

1. It’s even gives you a higher return if investment during market lows.
2. Simple management which is one time investment or decision.
3. It should be useful for short term financial goals.

Example:

Vaishali, a school teacher in Delhi, received a Rupees 3 lakh bonus. See will be invested the pull amount in a debt mutual fund and earned a stable return over 3 years.

So which one is best for you?

For Indian families with monthly regular income:

you can choose sip to build a long term wealth while managing your monthly expenses. SIP works leg budgeting you to allocate a portion of your income every month to investment similar to how you can handle your rent groceries EMI and other utilities bill.

For business owner or investor with lump sum:

if you receive irregular income or helping a bonus or savings line idle, lump sum investment 10 work as well as specially in a falling market or planning a short term goals.

there is no one size for all investment strategy, SIP offers you a discipline and consistency, it is ideal for a salaried individual. Lump sum works best when you happy significant or large amount and handle market risk.

” The best investment strategy is not about timing the market, about consistently align your money with goals – SIP or Lumpsum, the key is starting today. ” – by SmartRupeeblog.com.