1. SIPs are only for the rich - SIPs are accessible to investors across all income brackets. With investment amounts starting as low as ₹500, SIPs offer an affordable entry point for individuals from diverse financial backgrounds to participate in wealth creation.
Also Read: Mutual funds: SIP contributions jumped 28% to nearly ₹2 lakh crore in FY 24, shows AMFI data 2. SIPs guarantee high returns - SIPs do not assure high returns or protection against market volatility.
However, they offer the advantage of rupee cost averaging, allowing investors to purchase more units when prices are low and fewer units when prices are high, potentially mitigating market fluctuations over time. 3. SIPs are only for long-term investors - While SIPs are well-suited for long-term wealth accumulation, they also cater to short-term financial goals.
Investors can customise their SIP tenures according to their objectives, whether short, medium, or long term, providing flexibility in achieving financial targets. 4. SIPs are equivalent to mutual funds - SIP is a mode of investing in mutual funds rather than a separate investment product.
Mutual funds offer various investment avenues such as equity, debt, and hybrid funds, allowing investors to diversify their portfolios based on risk appetite and financial goals through SIPs.
Also Read: How to become rich: Your ₹5000 monthly SIP can help you grow ₹5.22 crore. Mutual fund calculator explains 5. SIPs are only for investing in equity - While SIPs are commonly associated with equity mutual funds, investors can opt for SIPs in debt funds as well.