SIP Tips: If you want amazing returns then start Step-up SIP, but do not make these 3 mistakes..

If you want to earn a lot by investing, then invest in Mutual Funds. Even in Mutual Funds, start Step-up SIP instead of SIP. Through this, you can make money from money quickly. However, some mistakes should be avoided while doing Step-up SIP, otherwise your money can sink quickly.

Step-up SIP is done in two ways.

Step-up SIP is a way of investment, in which you put a top-up in your monthly SIP every year and increase the investment amount. You can put this top-up in percentage like you can put a top-up of 10%, 12%, or 15% of the existing amount every year. Apart from this, you can also do stepping of a fixed amount. You can increase your investment by 1,000 or 2,000 rupees every year.

Understand with an example.

Suppose you start a SIP of Rs 5,000 and top-up it with 10% every year, then the SIP starting from Rs 5,000 per month will increase by 10% to Rs 5,500 in the second year and Rs 6050 per month in the third year. On the other hand, if you decide to start with a fixed amount of Rs 1,000, then the SIP of Rs 5,000 will become Rs 6,000 in the second year and Rs 7,000 in the third year. Similarly, it will increase by Rs 1,000 every year.

This is how you earn big profits.

If you run a simple SIP of Rs 5,000 for 20 years, then at the rate of 12%, you will get Rs 45,99,287 after 20 years. On the other hand, if you run Step-up SIP for 20 years with a 10% annual stepping, then you will get Rs 93,15,692 after 20 years.

Step-up SIP is beneficial for these people.

Step-up SIP is a good option for those who are employed at the beginning of their career but see the possibility of increasing their income in the future, business people whose income increases every year, and those who are investing for long-term goals like children's education, retirement or buying a house. But you should not make 3 mistakes while doing Step-up SIP, otherwise you may suffer a loss. Know about this in the slides below.

Do not step up without planning.

Increase SIP only after assessing your income and expenses. Do not do too many step-ups, otherwise, it may become a burden and it may be difficult for you to continue it for a long time.

Do not stop investing midway.

Whether it is SIP or Step-up SIP, it is very important to be regular in it. If you have to stop it, you may have to suffer losses.

Do not forget to review

Review your investments once a year keeping in view your income, inflation, and expenses. So that you can make necessary changes by assessing the profits and losses.

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