Level up your wealth: Turbocharge with step-up SIPs!

The total amount collected through SIP investments in India in February 2024 amounted to ₹19,187 crore. SIP investments are extremely popular in India, and investors are making the most of these popular modes of investment through step-up SIP investments. Read on to know how they can help you consistently grow your wealth.

What is a step-up SIP investment?

Also called top-up SIP investments, step-up SIPs constitute a category of SIPs (Systematic Investment Plans) that helps investors increase their investment amount by a fixed percentage periodically. You can choose to make a step-up investment on a percentage basis or an amount basis. The former helps you increase your SIP amount by a fixed percentage every year, and the latter helps you increase it by a fixed amount annually.

How can step-up SIPs turbocharge your SIP investments?

• You can make the most of lower prices during market corrections: You can benefit from market opportunities by increasing your SIP, given that SIP investments require the investor to invest at regular intervals. You can use a step-up SIP calculator to calculate your ideal SIP amount.

• Step-up SIPs help you earn more through the power of compounding: One of the reasons for the popularity of SIP investments is their ability to leverage the power of compounding. Investors earn interest on interest that helps them exponentially grow their wealth. A step-up SIP investment can help you significantly improve your returns by leveraging compounding.

• A step-up SIP investment helps you adapt to your changing financial goals: The nature of your financial goal and its total value can change over time. Step-up SIPs can help you account for this change and invest accordingly.

• You can reduce the impact of inflation on your savings through step-up SIP investments: A step-up SIP investment is the best way to mitigate the impact of inflation on your wealth’s purchasing power since it helps you increase your investment amount. Doing so can help you steadily increase your wealth even during high inflation.

• Step-up SIP investments can help you make the most of the tax benefits offered by an investment: If you have invested in a tax-saving investment scheme like an ELSS (Equity-Linked Savings Scheme) mutual fund, you can make the most of its tax benefits through step-up SIP investments.

How to make a step-up investment?

You must follow these steps to make a step-up SIP investment:

• Research online and choose a mutual fund investment.

• Decide on an initial investment amount.

• Use an SIP calculator with step-up to decide on the step-up percentage or amount and the step-up frequency.

• Choose the step-up percentage or amount and the step-up frequency.

• Make the payment.

An increasing SIP calculator can help you maximise the impact of your step-up SIP investments by helping you decide on the ideal frequency of your step-up SIPs and the fixed percentage or amount.

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