The market for mutual funds has grown significantly as a result of greater financial literacy. As of July 31, 2022, the mutual fund industry’s total assets under management reached Rs. 37.74 trillion. The Indian market has been navigating this turbulence thanks to ordinary investors’ trust. SIPs are typically used by retail investors to make mutual fund investments. SIP is thought to be a superior method of investing in mutual funds. But are you familiar with the many SIP types? Here, we’ll discuss the six SIP methods apart from regular SIP.
Step-up is another simple SIP variant. With this option, you have the opportunity to increase your investment over the course of the year. However, this will only occur if you want it to. Additionally, it will raise the amount you receive. Experts claim that individuals start SIP with a modest amount but neglect to adjust it as their lives develop. You can grow your investment quantity and manage your financial plan more effectively with this type of SIP.
Flexi/ Smart SIP:
Flexi SIP enables you to increase your investments both during bull markets and during bear markets. Because it is a general guideline to buy at the loan level and sell at the high, on the bottom. Because of this, it is also known as Smart SIP.
The trigger SIP is based on an occurrence in the market. For instance, you could want to invest if the Sensex or Nifty drops by a few percent, or you might want to boost your SIP contribution if the AUM of a fund drops. You have the option to take advantage of the chance with this kind of SIP.
It is a non-maturity date SIP, as the name implies, and it runs for as long as you choose to invest. Young investors are the ideal candidates for perpetual SIPs because they often invest for a longer period of time.
SIP with Insurance:
Numerous mutual fund companies provide free term life insurance as an added convenience to SIP investors who choose to invest in their plans. This is known as SIP insurance, which effectively serves as a supplement to the investors’ current insurance coverage. As long as the investor holds the investment, life insurance coverage is based on the SIP amount and is maintained.
It gives you the option to invest in several fund house schemes with just one instrument and offers a terrific approach to quickly and easily create a diversified portfolio. Multi SIP streamlines paperwork for investors, boosts investor confidence and enables simultaneous investment planning for a variety of financial demands.