Here are seven SIP mistakes to avoid while investing:
lifestyle Aug 11 2024
Author: Richa Barua Image Credits:Freepik
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Starting Late
Delaying SIP investments might hurt long-term gains. The earlier you start, the longer your money may compound, increasing wealth.
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Stopping SIPs During Market Downturns
You can lose reduced buying costs by ceasing SIPs during market downturns. SIPs function best when invested frequently regardless of market circumstances.
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Investing Without Clear Goals
SIP investing without financial goals may be erratic. Set objectives like retirement, home buying, and children's education to guide your investing.
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Ignoring Fund Performance
Not monitoring your mutual fund might be risky. Check the fund's performance often and swap if it underperforms.
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Choosing the Wrong SIP Amount
Setting an SIP amount too high or too low can affect your financial planning. Choose a sustainable amount within your budget while helping you achieve your investment goals.
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Lack of Diversification
Investing all your SIPs in a single fund or sector can expose you to unnecessary risk. Diversify across different funds and asset classes to reduce risk and optimize returns.
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Ignoring Inflation
Shortfalls might result from ignoring inflation while setting investing goals. To grow your assets in real terms, adjust your SIPs for inflation monthly.