Why Should You Stay Committed to SIPs for the Long Term?
Indian markets are extremely volatile & here's why you shouldn’t pause SIPs.
As an NRI, you understand the power of financial planning and global opportunities. But when it comes to investing in India, what you don’t do can sometimes have a bigger impact than what you do. With market volatility making headlines, many investors feel the urge to act—especially when they see short-term dips in their investments. However, pressing the pause button on your Systematic Investment Plans (SIPs) can be a costly mistake.
Here’s why staying the course with your SIPs is crucial in the long term.
Market Fluctuations Are Temporary, Wealth Creation Is Long-Term
Seeing a few negative SIP returns over a 6-12 month period might be unsettling, but remember—SIPs are built to harness market volatility. When you stop your SIPs during a downturn, you miss the golden opportunity to accumulate more units at lower prices, which can significantly boost your future returns.
Don’t Let Short-Term Panic Derail Your Long-Term Goals
Many NRIs invest in SIPs with long-term financial goals in mind—whether it's securing a comfortable retirement, building a fund for your children’s education, or purchasing a dream home in India. Pausing SIPs, even for a few months, disrupts the compounding effect and delays your wealth-building journey.
The Power of Staying Invested
It’s no surprise that most SIP investors prefer to stay invested for 10+ years. The numbers speak for themselves—long-term SIP investors tend to see substantial wealth creation.
For instance, a monthly SIP of Rs 10,000 in a mutual fund with a CAGR of 15% would have now grown into an impressive Rs 27.86 lakhs, with a total investment of just Rs 12 lakhs.
Volatility is a Feature, Not a Bug
Market ups and downs are a natural part of investing. History has shown that markets always recover, and those who stay invested emerge stronger. By stopping SIPs, you risk missing out on the best recovery phases. Additionally, SIPs help you maintain investment discipline, ensuring you don’t fall into the dangerous trap of trying to time the market—a challenge even for professional investors.
So, What Should NRIs Do?
If you’ve carefully mapped your SIPs to your financial goals, the best action is no action. Staying invested, even during market fluctuations, ensures you benefit from the power of compounding and rupee cost averaging.
Your financial future isn’t built in a day—it’s built over decades of consistent investing. So, trust the process, keep your SIPs going, and stay on the path to long-term prosperity.
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Stay invested. Stay disciplined. Stay ahead.
Happy investing!