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Lakhs of investors in India start SIP, but most of the people are not able to continue it for a long time. Stopping SIP in panic as soon as the market falls causes the biggest loss, which becomes understandable later. According to experts, quitting SIP is not like investing but choosing loss.
New Delhi. Despite the increasing popularity of SIP in India, a worrying trend has emerged that almost 90 percent of investors stop SIP within three years. Experts say that this whole matter is of ’emotions versus finance’. Investors are very excited in the first year. As soon as there is a slight decline in the market in the second year, they start getting scared and stop SIP. When the market returns in the third year, regrets start and then SIP is started again. This cycle is repeated again and again, and because of this investors do not get real profits.
Biggest Disadvantage: The Cost of Leaving Early
Experts explain this with an example. If a person runs a SIP of Rs 5,000 every month for 20 years at an average return of 12 percent, then he can get approximately Rs 45 lakh. But if he stops SIP for just 3 years out of fear, he will lose potential wealth of up to Rs 15 lakh. That means stopping SIP is like stopping your money from growing automatically. The magic of compounding works only when the money is invested continuously and time allows it to grow.
SIP is most beneficial if the market falls
Many investors believe that SIP should be stopped when the market falls, but this is the biggest misconception. When the market is down, SIP investors are able to buy more units, which means the real profit comes in these difficult times. Experts say that ‘SIP is a long-term wealth building tool. Shutting it down at a weak moment is like shutting down a car’s engine when it is about to reach its best speed.
Discipline is necessary instead of fear, only then wealth will be created.
The key to making SIP successful is not market timing, but discipline. Every missed installment pushes your goal back by months. This is the reason why experienced investors continue investing even during downturns. Whether the market goes up or down – if the investor remains regular, then the returns automatically get better in the long run. This kind of discipline is what separates successful investors from the rest.
Market ups and downs – not a path, but part of the journey
The real rule of investing is that the market does not always move the same. Sometimes boom, sometimes decline – all this is natural. But only those investors who continue SIP through all ups and downs end up creating huge wealth. Keeping SIP active is your biggest weapon. Control your emotions, the market itself will support you.
It’s not the timing, it’s the time that matters.
In the end the same old principle proves true again – Time in the market beats timing the market. The longer your money remains in the market, the more wealth you create. So next time when the market falls and you feel like stopping SIP, remember the goal once. SIP is a game of patience and patience gives the biggest profit.
