An Investment Approach to Help you Achieve Your Financial Goal

Systematic Investment Plan.

- Navneet Kumar Dubey

More often people are afraid of market situations, so, if you don’t want to get in to the trap, take SIP route, where a fixed sum is invested for a fixed time period, which is actually the time period of your financial goal. Most of the time, we are reluctant to invest heavy amount, but if we route our investment on a regular basis, we need not to invest a very big amount but instead, small amounts invested regularly will help you to achieve your financial goals of life and the best way to achieve it do systematic investment planning for a longer time period. Let us understand the concept of SIP (systematic investment plan).

What is a Systematic Investment Plan (SIP)? SIP enables you to invest over the longer time period, reducing the risk of market volatility and helps you to build a portfolio, which can be utilized to achieve your financial goal. SIP can be linked to any of the goals whether it is child’s education, wedding planning, overseas vacation, car purchase, retirement planning or house purchase.

Working Concept of SIP Once you have identified the recommended solution through financial planning you can easily start a SIP, all you have to do is to give a cheque, with relevant details for the amount you want to invest. You Will be allotted fund units at every regular interval of time. There is a least risk of timing the market while your investments are going through the rough edges of the market.

Rupee Cost Averaging: Investing in SIP enables an investor to take part in the stock markets without actively timing them and he/she can benefit by buying more units when the price falls and less units when the price rises. This scheme helps reduce the average cost per unit of investment through a method called Rupee Cost Averaging.