- Higher investment amount could mean substantially higher corpus
- Helps you in keeping up with inflation
- Helps you know if your investment plans are track or needs change
Yes, you can increase your SIP investment amount periodically by:
- You have to fill another auto debit form for your SIP and then select a date when you want it to take effect from. You then need to give the cheque and the form to the bank for being deposited. Once the process is complete, you need not worry about repeating it each month. The fund would auto debit it along with the ongoing investment in the same fund.
- If you have a lump sum amount that you need to pay, you would have to fill an Additional Investment Form. This would again be accompanied by a cheque of the same amount which has to be sent to the fund house office.
- Alternatively, you can even give a signed ECS mandate to your financial advisor. Through this, another SIP in the same fund and folio can be started. You can then choose if you wish the same auto-debit date like your previous SIP or a different one.
Increasing the SIP amount can be done based on the amount or on the percentage. This can even be capped beyond a certain point so that it doesn’t exceed your budget. For instance, if you choose a 5% increase annually for your SIP, the amount invested would rise by 5% every year. However, you can set an upper limit amount so that once your investment reaches that, it automatically stops this top-up and switch towards a constant SIP amount for the rest of your tenure. This would ensure that you don’t overshoot or undermine your SIP amount but keep it just enough to meet your goals.