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Systematic Investment Plans (SIP)

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I am sure many of you folks already have made SIP investments. But at the risk of rejection I will repeat the benefits of doing this

1. Power of Compounding - Give your funds more time to work for you
Most of us always wait till the n'th moment to make the investments. Assuming that you cannot shift your goals (children's education, marriage etc) the longer you delay planning for this, the greater will be the burden on you to meet those goals. In simple terms it only means that the more delay there is the lesser time your money has to work for you and that only means your input needed for a expected output will increase. On the other hand, you would be surprised what you could achieve by saving a small sum of money regularly at an early age.

Input Cost Averaging - Invest as much in the peaks as you would in the troughs
You need not average your investments if you can invest at the bottom and sell off at the top. But when do prices go up and when do they go down - you just cant guess this, and that is where averaging comes in. So the best bet you can take is invest at regular intervals (keep the intervals as small as possible) and you can automatically see that your average price over any good period of time (2-3 years) would be close enough to the lowest price.

3. Discipline pays off
Unless there is a strict pattern in sticking to your investments any investment you start will fade away very soon. Murphy's law will ensure that whenever you need to make an investment you will have a more pressing need for that money and your will delay your investment - delays are always an added burden !

So in summary folks if you have not already started investing in a SIP do it today (I invest in a SIP with
Reliance Mutual Fund)

I just received an email in the morning from
ICICI Direct about mini Gold and Silver investments and I definitely did find that interesting too. I am seriously thinking of making some SIP investments into commodities - start would definitely be from the stars Gold, Silver, Oil !

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