Long-term SIPs: The key to financial goals

Almost every person has a financial goal that encourages them to save money and to make fruitful investments. Though there are many investment options available in the market today, investing in a long-term SIP is one of the most feasible and fruitful ways of achieving your financial goals. In SIPs, the investors are required to put away a fixed sum of money in funds on a regular basis and in return, they enjoy the power of compounding in the long run.

Which features of SIP help to achievea financial goal?

The features of SIPs tend to help the investors to achieve their financing goals:

  1. Cost average: Regardless of the market condition and the NAV, SIP investors are required to invest a fixed sum of money on a regular basis. This feature ensures that they lower the cost average by purchasing more units in a low market and redeeming them for higher profits a thriving market.
  2. Market timing: With the feature of regular investment comes the freedom from predicting the future of the market. Such freedom eliminates an unnecessary mental burden and helps them manage their wealth better.
  3. Simpleinvestment: The process of investing in a long-term SIP is quite simple. Others may forget to invest regularly in their investment schemes but a SIP inculcates a sense of discipline in the investors and the task of investing becoming as easy as breathing for them.

How long-term SIP investment helps to achieve your financial goals?

When a person has a certain financial goalin their mind the full proof way of achieving them is through regular investments for a long period of time.  Even an investment of a small sum can magnify the benefits of SIP over time:

  • The compounding effect:  Even a small sum of the deposit can accumulate over time to create a strong corpus. You can utilise the compounding effect for wealth generation by reinvesting the returns earned on their investment and again investing the returns earned from the returns.
  • Independence from market timing: Investing in long-term SIPs gives you the freedom from predicting the future of the investment market and helps you focus more at your professional and personal life. Besides giving you the freedom from predicting the market conditions, the disciplined habit of investing in long-term plans allows you to grab exciting opportunity irrespective of the market standing. 
  • The ease of creating wealth: You can accelerate the process of wealth creation by indulging in regular systematic investment in long-term plans. A disciplined SIP investor can reduce the brunt of volatility related to equities and can also sound returns. Besides the dividends, the capital gains earned by a long-term SIP investor are tax-free, which means more money at hand for wealth creation.

In short, the key to achieving your financial goals is to create wealth by remaining invested in a SIP for as long as you can. Avail the assistance of our professional fund managers whose expertise will helpyou to identify potential investment opportunities and help you meet your financial goals successfully.

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Mutual Fund investments are subject to market risks, read all scheme related documents carefully. Past performance is not an indicator of future returns. Wealth Redefine is a AMFI registered Mutual Fund distributor – ARN - 167127

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