A Systematic Investment Plan (SIP) is a tool used by investors to systematically save and invest in financial products like mutual funds. It helps an investor to invest a determined amount of money in a chosen asset, like a mutual fund scheme, either at regular intervals or in instalments. This investment plan offers tremendous potential to investors for growing their wealth, provided it is done systematically with long-term goals in mind. SIPs provide the investor with the advantage of starting small and investing periodically. Initially, the investor can start with a small sum and set it aside to invest at regular intervals. The advantage is that it allows the investor to invest in a disciplined manner and also benefit from what is called ‘Cost Averaging’, meaning the investor can buy more units when the market goes low, and lesser units when the market is peaking. The process reduces the overall risk of their investments and accounts for the volatility of the market. The ...