Starting a SIP for the first time? Learn how to choose the right mutual fund
No matter how small the SIP amount, consult a financial advisor. This will help you choose the right fund, understand the risks, and set goals.
Starting a SIP for the first time can seem a bit complicated for many new investors. The variety of mutual funds, time horizons, risks, and schemes often leaves one unsure how to get started.
However, financial experts believe that starting a SIP with the right information and guidance is the simplest and most reliable way to build long-term wealth.
Nowadays, even young earners and students are adopting SIPs to prepare for their future. Therefore, knowing how to choose the right fund becomes crucial.
How to start SIP?
How should one start a SIP and which fund is best to choose? Financial expert Harshvardhan Rungta explained in detail what beginning investors should pay attention to.
He said that the first investment experience should be extremely positive, so that new investors can proceed with confidence, rather than being put off by misunderstandings or the wrong product.
Before choosing a fund, decide these three things
According to Rungta, it is very important to understand three important things before the first SIP.
- Time horizon (how long to invest)
- Risk appetite (how much risk you can take)
- Financial Goals (What is your goal)
Whether the goal is higher education, marriage, buying a house or retirement, the right fund is chosen accordingly.
- Debt funds for short-term goals
- Hybrid funds for the medium-term
- Equity funds are considered best for the long term
For young people, the biggest benefit of long-term investment is compounding, which allows the fund to grow rapidly over time.
Expert advice: Consult an advisor
Rungta said that no matter how small the SIP amount, it's important to consult a financial advisor. This helps you choose the right fund, understand the risks, and set goals. This makes your first investment experience safe and positive.
Like Pragati, if you want to start an SIP early in college or your career, now is the best time. With proper planning and understanding, this start can strengthen your financial future.