Thursday, April 4, 2019

5 SIP Blunders That Can Cost Investors Heavily

When it comes to investment, the SIP is a great way to invest. Systematic Investment Plans are loved by retail investors. It will let them automatically purchase more units during a low market phase and vice-versa.

There are other benefits of going for SIPs instead of other lucrative funds. SIP involves regular investing and this will let investors leave a sigh of relief as they need not time the market. However, a lot of people mess their investment up by making some huge blunders.

SIPs have the ability to make the lives of their investors a better one, but committing a few common blunders can ruin things. A list of the 5 blunders is presented in this article below. For better guidance regarding SIP and financial investment in general, one can visit good financial experts like Wealthclock Advisors.

Some wrong moves that investors need to be careful about

Staying tight-fisted

With SIPs, an investor can succeed in fulfilling his investment goals and thereby, make his financial planning success. However, after a certain time, one needs to question themselves have they invested enough? Staying tight-fisted in case of investment is not the right way to grow wealth. So, an investor should be heavily active towards reaping off more benefits from SIP.

Market timing

A lot of investors often put a halt to their SIP investment temporarily when they see the equity market is correcting. The expert advisors recommend avoiding this step. Pausing SIPs midway can prove hazardous as it can heavily affect the investment process and the financial plan in general. Investors can lose out on fruitful opportunities.

A financial investor can have thousands of questions before venturing into SIP. One of the most common ones of them all is, “How to do SIP online?”. To get the best answer to this question, they can visit a professional financial advisor.

No diversification

One of the most common mistakes that an investor makes is they invest all their money into one single fund. This may be convenient but can lead an investor to end up with disastrous results. SIP is always beneficial in every sense but for it to provide the most stunning results, one need to diversify their investments.

Diversification will offer great returns during the most difficult market times. One also needs to review fund returns after every year. A competent financial advisor will also answer other important questions such as “How to purchase mutual funds?”.

Wrong choices

Although SIP is great in terms of automatic monthly installment payments, at most times investors select the wrong SIP dates. The ideal date should be one that is after salary is usually credited as this will benefit investors.

No flexibility

A lot of investors are thrown off their investment track when an emergency pops up. Since they have not prepared for the same, they face the wrath of time. So, other than committing heavily to SIP one also needs to keep emergency and difficult times in mind and utilize their money likewise.

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