Sip Top Up – Shortcut to your goal

A Systematic Investment Plan (SIP), more popularly known as SIP, is a facility offered by mutual funds to the investors to invest in a disciplined manner.


SIP facility allows an investor to invest a fixed amount of money at pre-defined intervals in the selected mutual fund scheme.


The fixed amount of money can be as low as Rs. 500, while the pre-defined SIP intervals can be on a weekly/monthly/quarterly/semi-annually or annual basis.


By taking the SIP route to investments, the investor invests in a time-bound manner without worrying about the market dynamics and stands to benefit in the long-term due to average costing and power of compounding.


Top-Up SIP

Top-up SIP is a facility that lets you increase your SIP by a fixed amount or percentage (say 10%) every year or at pre-defined intervals in line with an increase in your income/savings.


This Top -Up in your SIP allows your investments to be in line with the increase in the cost of living or inflation and helps you plan for your financial goals right.


It can also help you reach your financial goals earlier or create a larger corpus for your goal.


Mr. A
Normal SIP
Investor A started investing
5,000/month using Normal SIP for 25 years
with 12% Rate of Interest Total Investment:  15,00,000
Final Corpus after 25 Years  
Mr. B
SIP with 10% Top-Up
Investor B started investing
5,000/month using Normal SIP for 25 years
with 12% Rate of Interest Total Investment:  59,00,000
2.07 Crores
Final Corpus after 25 Years  

Power of Compounding

When you invest regularly through SIP and invest for the long term, the benefits are magnified by the compounding effect.


The compounding effect ensures that you earn returns not only on your principal amount (actual investment) but also on the gains on the principal amount i.e., your money grows over time as the money you invest earns returns.


And the returns also earn returns.


Share on social media