No Bonus, Increment This Year? Doesn’t Mean No Sip

Last year was quite taxing for everyone – be it businesses, industries, individuals, or economy. Thanks to the global pandemic that hit us, not all of us received bonuses or for that matter, even increments to match the previous years. What’s shoddier, along with stagnant or even lower annual influx in the bank account, the value of your investments are mostly at a standstill too. So, in such a state, what should an investor do about their mutual fund investments? Here’s what you as an investor can do during such uncertain and ambiguous times.

  1. Don’t pause your monthly investment in SIPs– While you might have witnessed a decent growth in your SIP (Systematic Investment Plan) each year, if you haven’t received a significant increment or bonus this time, it is advised to continue with your SIP investments and invest in SIP this year as well. Try not to decrease your monthly SIP investment amount than previous year as your long-term financial objectives and goals are driven by your monthly SIP investment. If required, refrain from making unnecessary expenses but consider SIPs as sacred and do not try to pause it.
  2. Don’t switch to relatively safer investment options – Trying to reserve your profits as much as you can during a market downturn is a natural instinct. Several investors stop their equity investments and switch to safer investments options such as bank fixed deposits and debt mutual funds. However, is it the right approach? Experts often frown on such practices and advise their clients to refrain from doing such practices.
  3. Slack down on your unnecessary expenses– If need arise, consider cutting down on your voluntary overheads to put up with your monthly SIP investments. This does not interpret that you must sacrifice your daily and essential needs such as food, medicines, school fees, rent, and so on. Instead, you can consider cutting down on other significant expenses like weekend trips, frequent dine-outs with your friends, designer clothes, expensive vacations, etc. Cutting down even a small amount on these frills will help you to generate that extra bit to continue with your SIP investments.
  4. Pay attention to your job – While your mutual fund investments might change their value over time, ensure that your job remains air-tight. Only when you give your best in the professional space, you would be able to enjoy the benefits of future employability and stable income and probably even a steady raise over time.

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Even though the markets have been quite turmoil, experts advise to invest in mutual funds for the long run and meet your financial objectives. You can also use an SIP calculator to understand the future returns on your mutual fund investments. Thanks to the advanced technology, you can easily invest in mutual funds online from the comfort of your home. Happy investing!