SIP Tips: Are you investing in SIP blindly? These 3 mistakes will cause you loss..

The number of people investing in Mutual Funds is increasing every day. Investing in Mutual Funds through SIP is not only easy for people, but it is also capable of giving them good returns in the long term, which is not easily available in any other scheme. This is the reason that now people in small cities and towns are also investing in Mutual Funds. But it is not right to invest just by listening to people. Small mistakes in this can also cause you a big loss. Here know the mistakes that you should not make.
Do not make this mistake.
Do not invest a large amount in SIP just to earn more profit, otherwise your budget will get disturbed. It is also possible that you may not be able to continue your SIP for a long time. Therefore, you should decide the amount of investment by looking at your financial situation.
What is the benefit?
You get flexibility in SIP. You can stop it anytime, pause it in between and increase or decrease the amount in SIP. Take advantage of this flexibility and invest according to your pocket. Then as your income increases, increase the investment accordingly.
Not investing for the long term.
You can start SIP for short term also, but if you want to get big profits then invest in it for long term. Risk is less in long term. You get the benefit of averaging. You can get better returns in the long term. Avoid investing all your money in a single fund. This increases the risk of your investment. Balance your investment in debt, equity and other asset classes. This can reduce your risk to a great extent.
Ignoring the expense ratio
Do not ignore the expense ratio before investing in mutual funds. Usually, you might think that if the return of a fund is 15% or 18%, then you will also get the same benefit by investing. But this does not happen because the expense ratio comes in between.
What does expense ratio mean?
The management cost of your mutual fund is called an expense ratio. The expense ratio of any fund decides how cheap you will get a fund. A low or high expense ratio also affects your returns.
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