Short on funds? Pause your SIP, don’t stop!

Successful lifelong investing doesn’t require an insane IQ, unusual business acumen, or insider information. What is required is a strong intellectual framework for making decisions and the ability to prevent emotions from destroying that framework.

Regular investing allows you to invest systematically and with less effort. You do it little by little, depending on your saving capacity, generating a new habit. And as happens with habits, in the end, you do it without realizing it, without having to give up what you really like to do: enjoy life.

Mutual funds provide a lot of investment alternatives to investors, of which, one of the best is SIP. By choosing this option, the investors can invest a small amount of money for the long term instead of making a lump sum investment at once. Besides, the rupee cost averaging principle of SIPs has made it the most preferred investment instrument.

The reason behind this is that the contribution made by the investor is usually fixed and does not depend on the prices of stocks. This allows the investor to buy a few shares at the time when unit prices increase and more shares when unit prices decrease.

It may happen that after reaching a certain age, you may want to invest online in mutual funds as per your risk profile. With mutual fund SIPs, you can choose to invest in a wide variety of funds, like debt funds, equity funds, ETFs, etc.

What to do if you are not able to invest regularly?

Any person can face financial distress in his life. For an investor, such situations may force him to end/stop their investments, but this is not the right decision.

Due to multiple reasons, any mutual fund investor may think of stopping mutual funds SIP investment plan. If you are also thinking the same, then instead of stopping it, you can ‘pause’ it. With this, you will not have to deposit money in SIP for 1 to 6 months. Most of the mutual fund houses are providing this facility.

What is the ‘Pause’ feature?

As we know, the true power of SIP lies in the time period for which the investment was made, it is completely pointless to cancel your plan in between. To offer investors a chance to maintain their investments despite suffering from financial issues, the pause facility has been made available.

Under this facility, you can stop the investment for some time. Earlier this facility was for 1 to 3 months, but now some fund houses have extended it from 1 to 6 months. The biggest advantage of this is that if you ‘pause’ the SIP for 6 months, then after 6 months the SIP will be automatically deducted. No additional interest will be payable on this.

There are uncountable reasons why SIP is considered to be the best choice for small investors, starting from the ability to begin investing with Rs. 500 per month to its pause facility.

So, why not use this investment instrument in your favor and invest in mutual funds investment plan a small portion of your income each month to become a millionaire in just a few decades?