Why you shouldn’t stop your SIPs (or any investments)

October 29, 2019 . Ranganayaki R

Are you one among many that have always wanted to make regular investments and gear up towards building wealth for the future? 

So you garner the courage to put together a small amount of your “savings” to start an SIP. But! Instead of letting it compound, you check the daily status of your investments and let it add on to your stress. And this (absolutely unnecessary) stress, at some point, lets you think it’s better to stop your SIPs once and for all!  

Read on to understand as to why market volatility shouldn’t make you stop your SIPs.

Dont stop your SIPs

The trump card called SIP:

On one hand, not everybody will be willing to invest a lump sum in mutual funds. On the other hand, not everybody HAS the amount in the first place. And this is where SIPs come to the rescue. 

  • SIPs are lighter on your wallet. You don’t need thousands and lakhs to start an SIP. An amount as small as ₹500 invested in regular intervals can help you big time in the long run. All you need to do is, keep a small amount aside in regular intervals
  • When SIP investments are considered, YOU are the king. You get to make a decision on the amount to be invested, the interval, and the frequency of investments. You can even stop your SIPs whenever you want to
  • SIPs are not affected much by fluctuations in the market, thanks to rupee cost averaging
  • SIPs help you build wealth by compounding. Your wealth keeps multiplying as long as your investments are active
  • More than anything, SIPs help you save regularly. The fact that a certain amount goes for SIP investments automatically, restricting you from spending it, is more than enough to convey why you must never stop your SIPs

Reason for you to not stop your SIPs:

  1. It makes absolutely no sense to stop your SIPs due to current conditions, as markets and the returns they yield differ at different time periods. Short term down markets as seen from history are temporary and are usually followed by up markets.
  2. Those investing in equity SIPs should always hold their investments for a minimum of five years, as “long” is the name of the equity game.
  3. Those planning to stop their SIPs due to lower returns should think again. If your income has increased, so should your investment amount. Investing the same amount after a hike is simply not fair.

So, don’t stop your SIPs unless you have achieved your goals. Plan and invest wisely!

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