Introduction
Systematic Investment Plans or SIPs are one of the most popular investment options in India for the last few years. Mutual funds and SIPs are an excellent place to invest money for the long term and watch it grow by leaps and bounds.
Once you start investing in an SIP, no matter how small an amount you contribute regularly, you will see it growing immediately. Your money is invested in the stock market with a portfolio tailored to bring you great returns at the end of a time period.
Smart investors generally choose to go for the best SIP plans for the long term. At the end of a long tenure, your purchase cost will be beaten by the average and your returns will be maximized. By investing regularly and in all market conditions, you are bound to get back your investment amount along with a high returns percentage.
There are several types of SIPs and hundreds of options to choose from if you are a beginner looking to invest in an SIP. But before you make a decision, you must know the basics of an SIP and why you should put your money here.
Long Term SIP: What and Why
A systematic investment plan is a financial strategy in which an investor puts a particular sum of money periodically as a mutual fund calculator to generate maximum growth. For each stipulated time period, you should put the same amount of money for maximum benefits.
SIPs let you get long term gains and give you the privilege of regular savings. It does not put a burden on the investor as the minimum investment for a year can be as low as INR 500 or 100. SIPs are one of the most popular forms of investing in mutual funds. It is also perfect for beginners as you can start with a small amount and gradually increase your savings systematically.
There are several benefits to investing in an SIP for the long term.
- It offers long-term gains and helps you accumulate a lump sum amount of savings for the future.
- It creates the habit of regular savings, which can only be beneficial for an individual or family.
- It provides diversification, along with the benefits of averaging rupee cost.
- It offers the flexibility to withdraw your money in times of need.
- It lets you increase or decrease the investment amount according to your convenience.
5 Best SIP Plans for Long Term to Invest Your Money In
Now that you know how beneficial a long term SIP is, here’s a list of the five best SIP plans that you can choose to make long-term investments into.
Axis Bluechip Fund
Axis Bluechip Fund is one of the best large-cap equity mutual fund plans. It invests your money in stocks of companies that have a large market capitalization, that is INR 1000 Cr or more. This is a good long term investment option as it has the possibility and record of showing steady growth every year.
Axis Bluechip is considered a safe and less volatile investment, irrespective of Sensex performance, with returns of 37.8% in one year.
SBI Small Cap Fund
This long term SIP plan invests your money in emerging companies, which have a market capitalization amount of around INR 500 Cr. It has the potential to fetch good returns in the long term. As these emerging companies grow and evolve in the market, so will your money.
SBI Small Cap Fund has a positive past record, producing returns of around 62.2% in a year. What’s more, it requires you to invest a minimum of only INR 500 each year.
PGIM India Diversified Equity Fund
PGIM is one of the best performing diversified equity funds in India. These funds are invested across companies with varying market capitalization, i.e. large-cap, small-cap, and mid-cap funds. Diversified funds give you the most balanced portfolio, which helps to keep your money safer.
PGIM India Diversified Equity Fund can give you returns of 66.4% in a year, with a track record of showing steady growth in years of the recent past.
Parag Parikh Long Term Equity Fund
Parag Parikh’s funds have become one of the investors’ favourites in recent years. This is also a diversified mutual fund SIP plan that invests your money safely in a variety of large-cap, mid-cap, and small-cap companies.
Parag Parikh Long Term Equity Fund seeks to generate long-term financial growth for you by actively managing your investment in various equity and equity-related securities. It has shown a growth of 57.1% over a year.
IDFC Infrastructure Fund
IDFC Infrastructure Fund is a long term SIP sector fund. It invests your money in companies of a specific sector, like banking, pharmaceuticals, infrastructure, telecom, etc. You can choose a sector that seems likely to show the most growth in the long term.
Since infrastructure is a safe bet for growth and development in the future, this IDFC fund has the capability of giving you high returns, like 103.1% over a year.
|
Fund |
Net Assets INR (Cr) |
Minimum Investment INR |
3 months (%) |
6 months (%) |
1 year (%) |
3 years (%) |
5 years (%) |
2020 (%) |
|
Axis Bluechip Fund |
33,154 |
500 |
10.3 |
22 |
37.8 |
23 |
19.9 |
19.7 |
|
SBI Small Cap Fund |
10,191 |
500 |
16.3 |
25.9 |
75.8 |
29.2 |
23.3 |
33.6 |
|
PGIM India Diversified Equity Fund |
2,416 |
1,000 |
10.6 |
27.7 |
66.4 |
30.9 |
21.9 |
35.9 |
|
Parag Parikh Long Term Equity Fund |
16,076 |
1,000 |
12.5 |
27.4 |
57.1 |
30.7 |
22.9 |
32.3 |
|
IDFC Infrastructure Fund |
650 |
100 |
12 |
33.9 |
103.1 |
20.7 |
15.8 |
6.3 |
Start Investing Now!
Long term SIP plans work best when you begin at the right time and keep investing regularly, without getting anxious about the ups and downs of the market. While Nifty keeps showing highs and lows, the best SIP plans for the long term will help keep your money safe and give ample returns to secure your future.