Greeting To Our Readers!
Systematic Investment Plan, the most efficient and easy-to-understand mode to invest in mutual funds. For SIP investment in Mutual funds, experts say the Early You Start, The More You Create!
Well, to create a big corpus from SIP investment in mutual funds, along with early start and long-term, investment, there is more strategy that must be followed at intervals, Reviewing Your SIP investment As Per Your Goals!
Why Is There A Need To Review SIP At Times?
When an investors start investing at an early stage say at 25 years of age, his goals prominently include, buying fast cars and motorcycles or going for exotic vacations. If more than this then they will have retirement planning as their goal, however, it is rare.
When the responsibility of an individual increases with his age, his old goals also get replaced with new goals, that focus more on owning a home for your family, saving for their health, medical and education expenses, securing their future, owning a family car, going for family vacations, and giving them a good life.
Then comes the point to consider, if the goal changes with time and responsibility, then why leave your SIP static? Thus, it is advised to investors to keep up with their changing goals, and achieving their desired goals at your desired time, it is extremely important to reconsider your mutual fund SIPs with your changing money goals.
Big Dreams? SIP’s Should Be Big Too…….
When you started your SIP at 25 years, you aimed to buy a normal and a normal car, but with the increase in time, now you desire a big house and a big car. Basically, your goal has changed and that calls for a change in your SIP investment too.
Now that you want to own a high-end home, that too without taking a home loan, means you have to accumulate the whole cost of your big house with SIP in mutual funds.
Suppose the house you want to buy is worth Rs 1.5 crore and you want to buy it after 10 years, which means you have to accumulate 1.5 crores in the next 10 years.
Considering a growth rate of 12 percent per annum, your monthly SIP amount needs to be approx. Rs 65,000 for 10 years, to create a corpus of Rs 1.5 crore.
If you started planning for your retirement at an early age, then after you get married, you need to reconsider your Retirement money and similarly, you would require to increase your SIP investment for retirement planning too. This is because after you get married, you need to plan for the expenses of your spouse also, and thus you need to review your SIP amount.
Remember Saving Always Comes Before Expenses……….
Most people have a habit of saving money that is left over after their need expenses as well as luxury expenses. However, experts say, no matter at what age you started investing or what your goals are, if you are planning to secure your goals financially then you first need to save money and then plan your expenses with the leftover.
If your dreams are your priority, your savings should be too. So, instead of saving the leftover amount, you should use following the formula:
Total Income – Total saving = Total Expenses…..
Experts say any individual who is planning to invest for his goals must save at least 30% of his total income and then manage his expenses in what is left.
Let Us Sum Up…….
If you are planning to start investing in a mutual fund via SIP, to secure your goals financially, then you must remember to review your SIP with every big responsibility and financial goal associated with that.
Like do review your SIP investment when you have a baby, in fact, you must add more SIP investment to your portfolio to give the best education and better life to your child.
Do consult a certified, experienced, and expert wealth manager who guides you at every step of your financial journey towards growth, security, stability, and freedom.
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For any kind of query, you can contact us at Shri Ashutosh Securities Pvt Ltd., we are here to help you in any way possible.
Happy Investing!
(Mutual Fund investments are subject to market risk Illustrations are for example only, there is no guarantee of returns. Past performance is not an indicator/guarantee to future returns).