SIP allows you to invest a fixed amount regularly on a daily, weekly, fortnightly, or monthly basis in mutual fund schemes. Similar to recurring deposits, SIPs enable you to make small investments every month while earning returns.
The choice of the best date for investing in SIP (Systematic Investment Plans) mutual funds has no significant impact.
However, it’s worth noting that the impact of investment dates on returns can vary depending on the type of investment.
For example,
In the case of the Public Provident Fund (PPF), the interest rate calculation is based on the minimum balance maintained between the fifth day and the last day of each month.
If you deposit the money before the fifth day of every month, you can earn interest for the entire month.
Best Date to Invest in SIP Mutual Funds
According to a study conducted by WhiteOak Capital Mutual Fund (MF), the date of your SIP investment has no significant impact on long-term wealth creation.
WhiteOak Capital Mutual Fund analyzing SIP data from S&P BSE Sensex TRI (a widely tracked Indian Equity Market Index) over the past 26 years. WhiteOak Capital MF concluded that there is no meaningful difference in the average returns of SIPs initiated on different dates’ 10 Years SIPs.
The study examined the 10-year SIP returns (% XIRR) on a daily rolling basis for a particular date of the month, based on the S&P BSE Sensex TRI (a widely tracked Indian Equity Market Index) from September 1996 to September 2022.
The findings revealed that the average return for a 10-year SIP plan remained consistent at approximately 15.8% regardless of the chosen investment date. This data clearly demonstrates that you can achieve similar returns regardless of the date of the deposit each month.
You may like to read how to earn Rs. 1000 daily without investment online in India.
Best SIP Investment Day – Salary Credit Day
The best day to initiate a SIP investment is typically the day when you receive your salary in your bank account. This can provide convenience and ensure a regular investment pattern.
Since salary credit days vary among individuals and companies, it is advisable to consider your own financial situation and invest accordingly. You can go through our article how to invest your salary for better return.
The key to a successful SIP lies in starting early, maintaining regularity, and investing for the long term to achieve your financial goals rather than fixating on specific dates or frequencies.
Best SIP Frequency
A historical data analysis reveals that the frequency of SIP has little impact on long-term returns. Whether you opt for a daily, weekly, or monthly SIP frequency, the end result in terms of returns (% XIRR) is quite similar. This means you need to maintain consistency and invest a small amount regularly over the long term is more important.
The study found that investments of Rs 64.7 lakh made through daily, weekly, or monthly SIPs between September 1996 and September 2022 yielded similar returns of approximately Rs 5.0 crore, with an average XIRR of 14.3%.
You can check out how to invest 50 lakhs for monthly income.
Frequently Asked Questions (FAQs)
Starting early, maintaining regularity, and investing for the long term are key factors for a successful SIP investment, rather than focusing on specific dates or frequencies.
SIP (Systematic Investment Plan) and FD (Fixed Deposit) serve different purposes and have different characteristics.
SIPs are typically associated with investments in mutual funds and provide the potential for higher returns over the long term. They offer the advantage of rupee cost averaging and the flexibility to invest smaller amounts regularly.
On the other hand, FDs are fixed-income instruments offered by banks with a fixed interest rate and a predetermined maturity period. They provide capital protection and a guaranteed return.
The choice between SIP and FD depends on various factors such as your financial goals, risk tolerance, investment horizon, and liquidity needs.
If you are looking for potential higher returns over the long term and can tolerate market fluctuations, SIPs can be a suitable option.
However, if you prioritize capital preservation, a fixed return, and prefer a lower-risk investment, FDs may be more suitable.
The best time to invest in SIP (Systematic Investment Plan) depends on your individual financial goals, risk tolerance, and investment horizon. There is no specific “best” time that applies universally.
It is recommended to start investing early, maintain consistency, and focus on the long term rather than timing the market. Regular investments over a prolonged period tend to yield better results.
Yes, you can invest daily in SIP through the Daily MF SIP option, where you invest a fixed amount of money in a Mutual Fund every business day.
There is no specific date that guarantees better SIP returns. You can choose a date that aligns with your convenience, such as the first week of the following month if you receive your salary at the end of the month.
