Sushmita is in her late twenties. She started her career as a content writer around six years back. All the savings that she could have done were instead spent on exotic vacations, lavish clothing, and jewelry. Now that Sushmita wishes to purchase a car, she is unable to make the down payment due to lack of funds. This acted as a wake-up call for Sushmita, and she realised the importance of financial planning and that she needs to take matter in her hands and start saving and investing for her long-term financial goals. She wishes to create wealth quickly but lacks the patience to actively look for right investment options for her portfolio. Several working women often complain about the lack of resources and time to research the apt types of investment for their portfolio. This is when mutual funds come into play. Mutual fund investments offer professional management which negates the investor from spending generous amounts of time on research and evaluating the right investment option. However, an ideal investment does not end up at merely finding the right investment option for oneself. One needs to determine the right time to enter and exit the markets. As easy as it sounds, timing the markets is extremely difficult and often advised against by most market experts. Instead of wasting your time on attempting to time the markets, you can invest in mutual funds today with the help of SIP investments. Systematic Investment Plan or SIP allow investors to invest a fixed sum of money in their preferred schemes at regular intervals for a fixed duration of time. The periodicity of the intervals can be daily, weekly, monthly, yearly, or semi-yearly. In this article, we will focus on how SIP investments can be used to create wealth for women.
SIPs helps to inculcate financial discipline
Due to the auto-debit feature enjoyed by SIP investments, an investor ends up regularly investing in mutual fund schemes on a periodic basis. This instills a sense of financial discipline among investors which is needed to reach one’s financial objectives. By investing in mutual funds via SIP, an investor ends up allotting a fixed sum of money each month towards their dream of wealth creation.
SIP investments enjoy high flexibility
SIPs are quite flexible in nature. An investor has the liberty to choose the types of mutual funds they wish to invest in, the SIP investment amount, the periodicity of the intervals, type of SIP, investment horizon, etc. basis their financial objectives, availability of funds, risk tolerance, and investment horizon.
You can stop your SIP investments anytime you wish to
Though mutual fund experts frown upon the concept of pausing or stopping your SIP investments at mere market volatility, one has the option to pause or stop their SIP investments entirely if for some reason an investor is unable to afford the SIP installments. You can and must stop your SIP investments if the mutual fund scheme has been constantly underperforming for some time. This offers women the flexibility to manage their mutual fund investments efficiently and effectively.