Investing in mutual funds through Systematic Investment Plan (SIP) is an effective wealth building tool by contributing a fixed amount every month. But as your income grows, you are likely to have more money available to invest. A SIP Top Up allows you to increase the monthly investment amount periodically. SIP top ups can be specified as a percentage or a fixed amount every year. A small increase of Rs 500 would make a huge impact in your portfolio over the long term.
Key benefits of topping up your SIP:
Adapts to rising income: You expect your salary or income to increase every year. Employers offer increments or bonuses on an annual basis that can be invested as a top up to an existing SIP.
Helps reach financial goals faster: SIPs are designed to help you achieve your long term financial ambitions. A top up facility allows you to reach your financial goals faster or expand your goals to meet your needs. You can expect your income to grow over the years, so investing more in an existing plan is a logical step towards building wealth.
Helps fight inflation: Many investors choose to increase their contributions to stay in line with inflation. As inflation consistently erodes the value of your money it may be prudent to raise contributions to an investment plan for the long term.
Allow you to keep investing in an existing plan rather than open a new one: This facility also saves you from the hassle of managing multiple SIPs. A sudden rise in income or an unexpected new source of earnings would need to be systematically invested. But looking for a new investment opportunity is tedious and time-consuming. Instead, topping up an existing investment could be the most efficient option.
Top-up SIP, with greater return prospects, should gain your trust and tread the path of enhanced financial reliability to help you deal with the uncertainties of the future.
An Investor Education & Awareness Initiative
Investors should deal only with Registered Mutual Funds, to be verified on SEBI website under Intermediaries/Market Infrastructure Institutions”. Refer www.ltfs.com for details on completing a one-time KYC (Know Your Customer) process, change of details like address, phone number etc. and change of bank details etc. For complaints redressal, either visit www.ltfs.com or SEBI’s website www.scores.gov.in
Disclaimer: This information is for general information only and does not have regard to particular needs of any specific person who may receive this information. L&T Investment Management Limited, the asset management company of L&T Mutual Fund or any of its associates; does not guarantee/indicate any returns/and shall not be held liable for any loss, expenses, charges incurred by the recipient. The recipient should consult their legal, tax and financial advisors before investing. Recipient of this information should understand that statements made herein regarding future prospects may not be realized or achieved.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.