Systematic Investment Plans or SIPs are one of the most popular ways of investing in Mutual Funds.
SIP is just a method for investing in mutual funds; it is not an asset class like stocks, bonds, or commodities.
We can invest in mutual funds in two ways: lump sum and SIP. When we invest a lump sum, we put a large amount of money into a mutual fund scheme in one go.
In SIP, we invest small fixed amounts of money regularly usually every month on a predefined date submitting a one time application form.
SIP promotes disciplined investment.
SIP encourages forced savings and helps you build a corpus without cramping your lifestyle.
Image Courtesy: Union Mutual Fund
