Can I Do SIP for 2-3 Years?
Start Your SIP in Mutual Funds.
Many investors who just started or are planning to start their SIP in Mutual Funds ask this very common question: “Can I do SIP for 2-3 Years?”
Let me take this opportunity to clarify and guide you on where you should prefer to do SIP for 2-3 years.
If you are planning to invest monthly for the next 2-3 years, then invest only in the Debt or Arbitrage Category of Mutual Fund Schemes because they have low volatility and carry very little or negligible chances of loss of principal in such a short period.
However, the returns on these schemes will be at par with bank FD interests only. Since your period is short this is the best suitable option for you.
But remember, SIP in Debt or Arbitrage Funds are not suggested if your period is more than 3-5 years in that case you must prefer any equity category mutual fund scheme based on your risk profile.
The other key benefits of investing in debt or arbitrage category of mutual fund scheme are,
- No Lock-In Period
- Less Volatile Returns
- 1-Day Redemption (In case of debt funds)
- 3-Day Redemption (In case of arbitrage funds)
- No exit load after 7 days in most of the debt and arbitrage funds.
- Can Stop SIP or Redeem Funds anytime. (applicable for all categories of funds)
- Can Increase or Decrease SIP Amount Anytime. (applicable for all categories of funds)
If you have any other queries related to mutual funds, then you can click here to schedule a meeting with me.
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Hi, I’m Managing Director at Gurpreet Saluja Financial Services where I help my investors to invest in mutual funds and achieve their financial goals. I’m also a Value Investor and here I write about Personal Finance & Investing.
