Starting a Systematic Investment Plan (SIP) in mutual funds is one of the best ways to grow your wealth steadily.
Whether you’re a beginner or an experienced investor, SIPs help you invest in a disciplined manner with minimal risk.
In this guide, we’ll cover everything you need to know about how to start SIP in mutual funds, its benefits, and a step-by-step process.
What is a SIP in Mutual Funds?
A Systematic Investment Plan (SIP) allows you to invest a fixed amount in a mutual fund at regular intervals (monthly, quarterly, etc.). It helps in rupee cost averaging and compounding returns, making it a smart choice for long-term wealth creation
Benefits of SIP in Mutual Funds
- Disciplined Investing – Helps you invest regularly without market timing.
- Power of Compounding – Small investments grow into large wealth over time.
- Rupee Cost Averaging – Reduces the impact of market fluctuations.
- Affordable Investment – Start investing with as little as ₹500 per month.
- Flexibility – You can increase, decrease, or stop SIPs anytime.
- Tax Benefits – Equity Linked Savings Schemes (ELSS) offer tax benefits under Section 80C.
How to Start SIP in Mutual Funds – Step-by-Step Guide
Step 1: Set Your Investment Goals
Before starting a SIP, define your goals:
- Short-term: Buying a car, vacation, etc.
- Long-term: Retirement, child’s education, wealth creation, etc.
Step 2: Choose the Right Mutual Fund
- Equity Mutual Funds: Best for long-term wealth creation.
- Debt Mutual Funds: Ideal for stable and low-risk returns.
- Hybrid Mutual Funds: A mix of equity and debt for balanced growth.
- ELSS Funds: Tax-saving funds with high return potential.
Step 3: Select a Fund House and Open an Account
To invest in SIP, you need to choose a fund house (e.g., SBI, HDFC, ICICI, Axis, Nippon India). You can invest via:
- Directly on AMC (fund house) websites
- Through mutual fund platforms like Groww, Zerodha, Kuvera, Paytm Money
- Via banks and brokers
Step 4: Complete Your KYC Process
To invest in mutual funds, complete your Know Your Customer (KYC) verification by submitting:
- PAN card
- Aadhaar card
- Address proof
- Bank details
Step 5: Choose SIP Amount and Frequency
Decide the amount you want to invest and the frequency:
- Monthly SIP (Most Popular)
- Quarterly SIP
- Weekly SIP
Step 6: Automate Payments
Set up auto-debit (ECS/NACH) from your bank to ensure timely investments without manual intervention.
Step 7: Track and Review Your SIP Investments
Monitor your SIP portfolio every 6-12 months and make adjustments based on market conditions and financial goals.
Best SIP Mutual Funds to Invest in 2024
Here are some of the best-performing SIP mutual funds:
- Mirae Asset Large Cap Fund (Equity)
- SBI Bluechip Fund (Equity)
- Axis Long-Term Equity Fund (Tax-Saving ELSS)
- ICICI Prudential Balanced Advantage Fund (Hybrid)
- HDFC Short Term Debt Fund (Debt)
Also Read:
Best Stock Market Apps in India (2025) |
FAQs on How to Start SIP in Mutual Funds
1. Can I withdraw my SIP anytime?
Yes, except for ELSS funds, which have a 3-year lock-in period.
2. What is the minimum amount to start SIP?
You can start a SIP with ₹500 per month.
3. Is SIP better than FD?
SIP in equity mutual funds offers higher returns than FDs over the long term.
4. Which SIP is best for 5 years?
For a 5-year investment, consider large-cap and hybrid funds.
Conclusion
Starting a SIP in mutual funds is an easy and smart way to build long-term wealth. Follow the above steps, choose the right fund, and stay invested for better financial growth.
If you found this guide useful, share it with your friends and start your SIP today!
Sign Up Now:
(Disclaimer: The information provided in this article is for educational and informational purposes only and should not be considered as financial or investment advice. Stock market investments are subject to risks, and past performance does not guarantee future results. Please conduct your own research or consult a qualified financial advisor before making any investment decisions. The author and the website are not responsible for any financial losses that may occur based on the information provided.)
