SIP Mutual Funds Investment Book

 SIP Mutual Funds Investment Book

Systematic Investment Plan (SIP) is an Investment route offered by Mutual Funds wherein one can Invest a fixed amount in a Mutual Fund scheme at regular intervals– say once a month or once a quarter, instead of making a lump-sum Investment.

SIP stands for Systematic Investment plan, and it is a way to Invest a fixed amount regularly in mutual fund schemes. It is similar to a Recurring Deposit (RD) in a bank. In SIP, an Investor selects a period (1 year, 3 years or even perpetuity), intervals (weekly, monthly, quarterly etc.) and amount. The amount will auto-debit from the Investor’s bank account after every interval for a selected period. As retail Investors’ participation has been increasing in mutual funds, SIP is also gaining popularity amongst them. But still, most of the retail Investors are still unaware/unclear about Systematic Investment Plan (SIP). So, below we have explained the benefits of SIP.

Pros of SIP:

Rupee Cost Averaging

This is the primary benefit of Investing in mutual funds via SIPs. Rupee cost averaging is a phenomenon in which an Investor continues to Invest a particular amount at fixed intervals regardless of the share price/NAV. An Investor receives more units when the NAV of a mutual fund scheme decline and fewer units when NAV of the scheme rises. Therefore, over a long period of time, the cost of units to Investors will be significantly lower despite volatility.

Disciplined Investing

By committing to Invest a particular amount at a fixed interval for a particular period of time, Investors instill discipline in their character, which is essential for building wealth in long term.

Flexibility

Investors can decide the amount, period and interval of SIP as per their convenience. Besides, they can increase, decrease or stop the SIP in a mutual fund anytime.

Cons of SIP:

SIP returns are lower in consistently rising markets:

Imagine this situation – Its New Year eve of 2009 and your rich uncle impressed by you & your cousin gifts both of you Rs 1 Lac. You both being financially prudent want to grow this windfall. You approach a financial planner and as every good planner would, he recommend you to Invest in NIFTY BeeS using SIP. So you follow him and plan Investment in 12 monthly SIP installments while your cousin puts his entire money as lump sum Investment in the same NIFTY BeeS. Who do you think made more money by 2010 New Year eve? Your cousin would have around Rs 1.72 Lac while you would have Rs. 1.37 Lac. So your cousin gained 25% more just by doing lump sum.

Limited options of dates:

For a SIP in Mutual Fund you need to decide a date in advance when you like to do your SIP and give an ECS mandate for the same. Most of the MFs have limited option (mainly 1st, 5th, 7th, 10th, 15th, etc). So you tend to Invest in multiple mutual funds on the same date. You want to lessen your risk by spreading your SIP in the entire month by choosing different dates for different funds.

Fixed Amount:

There are times when you feel that markets are undervalued and you want to Invest more but then in SIP only a predetermined fixed sum gets Invested. Same is the case when you want to Invest less, you can’t do it.

Best SIP Investment Plans 2022  

SIP+plans › SIP+calculator

Buy Zero Commission SIP Plans  

Best Investment Plans

Choose the best out of 30+ plan, Highest Returns for Sum Invested.

Best Retirement Plans

Compare High Return Retirement Plans. Guaranteed Income.

Compare Investment Plans

Compare Guaranteed Income Plans Money Back Plans, Child Plans, ULIP

ICICI Prudential Mutual Fund - SIP Investment

Which is best Mutual Fund for SIP?

Is SIP good for Mutual Fund?

How can I start Investing in SIP?

Which is better Investment SIP or Mutual Fund?

SIP or Systematic Investment Plan   Mutual Fund

SIP calculator

SIP Mutual Fund calculator

top 10 Mutual Funds for SIP to Invest in 2021

how to start SIP Investment

best SIP plans for 1,000 per month

best SIP plans

SIP Investment full form

What are the pros & cons of a Systematic Investment Plan (SIP)?

Which are the best SIPs to Invest in India for beginners? My husband and I are planning to Invest 10k each per month in SIPs for a time frame of at least 7 years.

What is the best SIP (systematic Investment plan) in India with great returns? How long should the Investment be done for?

I want to Invest in SIP, 500 per month for 5 years. Is there any SIP available with this amount?

I’m planning to Invest in SIP (Systematic Investment Plan) with Rs. 3,000 per month for 5 years. What are some good SIP based on your experience?

Which is the best Investment: SIP, mutual fund or equity?

Add question

Is it good to invest money on SIP?

What is SIP (Systematic Investment Plan)?

I’m planning to invest in SIP (Systematic Investment Plan) with Rs. 3,000 per month for 5 years. What are some good SIP based on your experience?

What is the best SIP (systematic investment plan) in India with great returns? How long should the investment be done for?

How do I stop a SIP (Systematic Investment Plan)?

Can there be a loss in SIP (Systematic Investment Plan)? How?

Mutual Fund Investment Strategies,

Systematic Investment Plan (SIP),

Mutual Funds,

Investment Strategies,

Finance,

Investing ,

Books,

Mutual Fund Investment Advice,

Finance and Investments,

Book Recommendations,

 

Best Personal Finance Rules

Best Personal Finance Rules we all should better know.

1) Rule of 72 (Double Your Money)

2) Rule of 70 (Inflation)

3) 4% Withdrawal Rule

4) 100 Minus Age Rule

5) 10, 5, 3 Rule

6) 50-30-20 Rule

7) 3X Emergency Rule

8) 40℅ EMI Rule

1) Rule of 72

No. of yrs required to double your money at a given rate, U just divide 72 by interest rate

Eg, if you want to know how long it will take to double your money at 8% interest, divide 72 by 8 and get 9 yrs

At 6% rate, it will take 12 yrs

At 9% rate, it will take 8 yrs

2) Rule of 70

Divide 70 by current inflation rate to know how fast the value of your investment will get reduced to half its present value. 

Inflation rate of 7% will reduce the value of your money to half in 10 years.

3) 4% Rule for Financial Freedom

Corpus Reqd = 25 times of your estimated Annual Expenses.

Eg- if your annual Expense after 50 years of age is 500,000 and you wish to take VRS then corpus with you required is 1.25 cr.

Put 50% of this into fixed Income & 50% into equity.

Withdraw 4% every yr, i.e.5 lac.

This rule works for 96% of time in 30 yr period

4) 100 minus your age rule

This rule is used for asset allocation. Subtract your age from 100 to find out, how much of your portfolio should be allocated to equities

Suppose your Age is 30 so (100 - 30 = 70)

Equity : 70%

Debt : 30%

But if your Age is 60 so (100 - 60 = 40)

Equity : 40%

Debt : 60%

5) 10-5-3 Rule

One should have reasonable returns Expectations

10℅ Rate of return - Equity / Mutual Funds

5℅ - Debts ( Fixed Deposits or Other Debt instruments) 

3℅ - Savings Account

6) 50-30-20 Rule - about allocation of Income to Expense

Divide your Income into

50℅ - Needs  (Groceries, rent, emi, etc)

30℅ - Wants  (Entertainment, vacations, etc)

20℅ - Savings  (Equity, MFs, Debt, FD, etc)

At least try to save 20℅ of your Income.

You can definitely save more

7) 3X Emergency Rule

Always put at least 3 times your monthly Income in Emergency funds for emergencies such as Loss of employment, medical emergency, etc. 

3 X Monthly Income

In fact, one can have around 6 X Monthly Income in liquid or near liquid assets to be on a safer side

8) 40℅ EMI Rule

Never go beyond 40℅ of your Income into EMIs. 

Say you earn, 50,000 per month. So you should not have EMIs more than 20,000 .

This Rule is generally used by Finance companies to provide loans. You can use it to manage your finances. 

Very Imp Rule now 

Life Insurance Rule  [Not Recomonded at all] 

Always have Sum Assured as 20 times of your Annual Income 

20 X Annual Income

Say you earn 5 Lacs annually, You should NOT at least have 1 crore insurance by following this Rule

Some True Heart-wrenching stories of women left alone in old age homes

 Some True  Heart-wrenching stories of women left alone in old age homes

Lucky are the ones who have their elder's shadow, unlucky are the ones who have rejected their elders.

Image source.

These are the stories of those elderly mothers who, despite having children, have been rejected by them. The mothers who, despite having a home, rely on the help of others. A son who refuses to help and a daughter who ignores them. Desire to play with grandkids is consistently there yet their arms are vacant. 

Hands vacant, eyes open, lips tremble as they ask only one question, “When will you come to meet me?”

1. Harjeet Kaur.

Image source.

Age 78, has three children. Children work abroad, son in Canada and daughters in Chicago. After her husband's death, the question came up, if we leave mother at home then who will look after her? Kamla Devi Charitable Trust came as an option.

She has epilepsy as well as other stomach issues. The nurses at the Trust administer her medications and look after her. She leans towards living at the Trust instead of her home where nobody resides. She claims she only visits her house to tidy it as it reminds her of her children. 

Every year during the holidays, her children pay her a visit. She misses her husband and children a lot.

2. Kaishalya Devi.

Image source.

Age- 80 years, has one son and five daughters. Kaishalya Devi has lived twenty years alone. Her daughter asked her to go to her son and left her at his house. Kaishalya lived with her son for a year, they gave her food only when she gave ₹1000 per month. Whatever cash she used to get was taken by her child.

Until she gave cash, she was a mother however when she quit giving cash, Kaishalya was beaten by her girl in-law, child and grandson.

She had 60-70 thousand rupees with her, her children asked that she offer it to them however she didn't. They beat her, tore her clothes, and took all her money when she refused to give them money.

She had nowhere to go but die, people stopped her from doing so. Kaishalya lived alone on rent for a while after selling her house. After that she was left in an Ngo by her neighbours. No one came meet her.

3. Virmala Chauhan.

Image source.

Age 66 years, has five children, three daughters and two sons. Husband died from brain cancer. “Why do you just say, why don't you leave forever?” her sons asked Virmala after her husband's death. It struck Virmala's heart like an arrow, causing her to flee her home and seek refuge in an Ashram.

They come to visit her at times, according to her it's better this way. She yearns for their love but when it came to her respect she'd chose the latter.

4. Sushila Jain.

Image source.

73 year old, has three children- a son and two daughters. Sushila’s daughter-in-law asked, either she will live in the house or Sushila. To maintain peace Sushila left her house and came to live in ashram. 

She raised her son with all the love and care but was rejected by his wife and left alone. Her daughters doesn't know that she lives in the ashram neither does her son. 

5. Jitendra Kaur.

Image source.

70 year old, suffers from memory disorder. Has two sons, one lives in Dubai and the other in Ludhiana. She was removed by her first son after taking all her property.

The younger son told the authorities that after his wife's treatment he would come back to take her mother, but he never came.

6. Vimal Anand.

Image source.

Age 80 years, has two children, a son and daughter. She suffers from cerebral atrophy, which has limited the ability of speech and reasoning. Her son is a doctor in America and lives there, it's the reason she was sent to Vardaan senior citizen home. Daughter lives in Delhi, she visits her regularly yet because of her own family she can't live with her mom.

So many of our elderly population are forgotten about or disregarded. One day we will all be where they are. Is this how we will want to be treated?Our elderly deserve to be honoured and respected!

On the off chance that you run into any senior citizen in anguish, you can contact any of the accompanying NGOs for help:

• Dignity Foundation.

Phone: 6138 1100

Email: responsedignity@dignityfoundation.com

• Abhoy Mission.

Phone: 9436123069

Email: abhoymission@rediffmail.com

• Asha Kiran.

Email: Help@Ashakiranashram.Org

• VridhCare.

Phone: +91-8700851044

Email: support@vridhcare.com

• Dada-Dadi Help Foundation.

Phone: 9868124124

Email: advocatesushilraaja@gmail.com

Financial Help for Seniors In India: 20 Resources.

Exclusive Benefits Available To Senior Citizens In Income Tax.

Exclusive Benefits Available To Senior Citizens In Income Tax.

Income tax is levied on the income earned by all the individuals, HUF, partnership firms , LLPs and Corporates as per the Income tax Act of India. In the case of individuals, tax is levied as per the slab system if their income is above the minimum threshold limit (known as basic exemption limit).

These slab rates are different for different categories of taxpayers. Income tax has classified three categories of “individual “taxpayers such as:

• Individuals including residents and non-residents,

• Resident Senior citizens and

• Resident Super senior citizens.

Who is considered a senior citizen for Income Tax?

According to the Income Tax Act, a senior citizen is an individual resident between the age group of 60 to 80 years, as on the last day of the previous financial year.

Who is Considered as a Super Senior Citizen for Income Tax?

An individual resident above the age of 80 years, as on the last day of the previous financial year is regarded as super senior citizen.

8 Exclusive Income Tax Benefits for Senior Citizens.

The Indian Income Tax Act gives certain tax benefits to senior citizens and tries to make the income tax e-filing process hassle free, they are as follows:

1. The Elementary Exemption Benefit:

Every individual in India who falls under the income brackets is allowed for some elementary waivers.

The exemption limits are as follows:

• Regular citizen = ₹2,50,000 p.a. (age upto 59) 

• Senior citizen = ₹3,00,000 p.a. (60+)

• Super senior citizen = ₹5,00,000 p.a. (80+)

The exemption limit for tax filing for senior citizens in India is comparatively much more than an ordinary citizen.

2. Privilege on Interest Income:

The ordinary citizen who are residents of India will have to pay no tax on their interest earned up to Rs.40,000/- in a financial year.

While for senior citizens the limit is up to Rs.50,000/- in a financial year. 

U/s 80TTA of Income Tax Act, it will be considered as interest earned in the savings bank account, deposits in a bank, and/or deposits in post-office.

3. Benefits under Medical Insurance:

Under section 80D of Income Tax Act, an ordinary citizen can avail a deduction of Rs. 25,000/- on premium paid towards medical insurance for self, spouse, dependent parents and dependent children.

However, senior citizens can avail a deduction of Rs.50,000/- for the same.

For super senior citizens, under section 80 D, the deduction for the payment of medical premium as well as the actual expenses incurred on their treatment are allowed.

4. Allowance on the treatment of specified diseases:

Under section 80DDB of Income Tax Act, 1962, the deduction for an ordinary citizen availing medical treatment for specified disease/critical illness in a financial year is Rs.40,000/- or actual expenses, whichever is lower.

But for senior or super citizens the deduction is Rs.1,00,000/- or actual expenses, whichever is lower.

Age of the person who is availing medical treatment.	Amount of deduction (Rs.)
Age less than 60 years	Rs.40,000 or actual expenses, whichever is less
Senior Citizens- Age 60 years and above	Rs.1,00,000 or actual expenses, whichever is less
Very Senior Citizens- Age 80 years and above	Rs.1,00,000 or actual expenses, whichever is less

5. Offline Income Tax Return (ITR) filling: 

Income Tax Return (ITR) is a form which a person is supposed to submit to the Income Tax Department of India. It contains information about the person's income and the taxes to be paid on it during the year. 

It is mandatory for all taxable persons to do e-filing of income tax. Super Senior Citizens (individuals above 80 years) can file for their Income Tax Return through either Sahaj (ITR 1) or Sugam (ITR 4). They can choose to do it either manually or electronically.

6. No Advance Tax Liability:

Advance tax is the amount of income tax that is paid much in advance rather than a lump-sum payment at the year-end. Also known as earn tax, advance tax is to be paid in installments as per the due dates decided by the income tax department.

Every ordinary citizen whose estimated tax liability for the year is Rs. 10,000/- or more is liable to pay advance tax. 

However, a resident senior citizen (i.e., an individual of the age of 60 years or above during the relevant financial year) not having any income from business or profession is not liable to pay advance tax.

7. Standard Deductions from Pension Income:

Standard deduction means a flat deduction to individuals earning salary or pension income.

Retired senior citizen employees of Central and State Governments are also eligible for claiming standard deduction up to Rs. 50,000/- from their pension income.

8. No tax under the Reverse Mortgage Scheme:

Reverse mortgage is a loan which provides an additional source of income for senior citizens who have a self-acquired or self-occupied home in India. 

A senior citizen may reverse mortgage any of his accommodation to make monthly earnings. The ownership of the property remains with the senior citizen and they are given monthly payments for it. The amount paid in instalments to the owner is exempted from Income Tax.

9. Exemption from filing income tax returns (ITR):

In Budget 2021, the government announced that eligible senior citizens aged 75 and above will be exempted from filing income tax returns (ITR). However, it should be noted that this relaxation will come into effect only from FY 2021-22, i.e., for ITRs to be filed next year.