How can you start an online mutual fund SIP | Motilal Oswal

Can You Start an Online Mutual Fund SIP

A systematic investment plan or SIP is a widely used method to bring in financial discipline when it comes to mutual fund investments. A SIP allows investors to invest in a periodic manner (weekly, monthly, quarterly and so on) and it ensures stability, irrespective of market highs or lows. 

If you don’t have access to a lump sum amount for investment, a SIP is the ideal choice. What’s more, you can start small with a SIP, as low as Rs 500, which makes it convenient and not too burdensome on your wallet. 

How does one start a SIP in mutual fund?

Start with some research on the types of mutual funds and the best mutual funds available. You would need to look at the returns expected, your financial goal, ie, what is the amount you need at a specific point in the future for a specific goal, the time horizon you are comfortable with, the risk involved and the performance of the fund, among others. 

Knowing the purpose of your investment is half the battle won. It is vital that you have a clear picture of your goal before you start a SIP in mutual fund. Also, take into account inflation and how it impacts your financial goals. After that, you would need to factor in your current income and financial commitments before you decide on a specific amount for your SIP. How much are you willing to channelise in the fund on a periodic basis depends on your commitments, be they one-time or recurring. 

Having worked out all these factors, the most important step to take is to calculate your expected returns. Use a simple online tool such as a SIP mutual fund calculator to help you understand how much you would need to invest for you to reach a goal in a specific timeframe. 

Now, it is time to start an online SIP in mutual fund. Here’s how:

Make sure you fulfil all your KYC (Know your Customer) requirements online. You may be required to submit certain documents like proof of address, contact details and your PAN details. You would also be required to provide the image of a cheque from your bank/the bank from where you would be making your investments.

You will be provided with a link to register a new account and given an application form online to fill in all your details, including contact details on the form. You will be given access to log in with a username and password for all your transactions. 

The next step is to opt for a specific fund and the SIP you are looking at. Next, input the SIP amount and the tenure for the SIP. This amount can be changed as per your convenience. 

Then you can set a bank mandate for the SIP amount to be withdrawn periodically. 

Conclusion

Starting a SIP online is an easy process and can be done from the comfort of your home. Choose the right mutual fund, one that aligns with your financial goals and risk  appetite. Then use a SIP mutual fund calculator to compute how much you would need to invest on a regular basis to reach your goal and when you would reach the said goal. Fill in your personal details and relevant information online and begin your investment journey. 

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