How to Invest in Mutual Funds in a Disciplined Way Via SIP?

 

Mutual funds offer investors looking to invest in equities but not having the time or the expertise to do research, an excellent investment option. These professionally manged funds invest in stocks and other instruments based on the investment goals and objectives set out by their asset management companies. Investments in mutual funds can be done in two ways- by investing a lump sum amount or choosing the SIP route. Let us find out What is  SIP and Why should you go for it?

What is a SIP?

 SIP or Systematic Investment Plan is a method of mutual fund investing wherein an investor agrees to contribute a fixed amount every month or quarter or half-yearly for a pre-decided period. An excellent way to inculcate disciplined investing, the SIP option encourages investors to keep aside the committed amount for investment in a mutual fund. This option provides investors a chance to earn good returns by investing continuously and benefiting from rupee cost averaging. Investors can use a SIP calculator to identify which SIP is suitable for them and matches their investment and risk profile.

How Does a SIP Investment Make You Disciplined?

When you decided to invest in mutual funds in India via the SIP route, you commit to putting in a specific amount. And to fulfil this commitment before the due date you have to be disciplined in your spending to keep aside the SIP amount. You can even link your SIP to your bank account and give your bank instructions to transfer a specific amount on the due dates. This saves you the hassle of worrying about your expenses and struggling to save. This way you start spending after keeping aside the SIP amount.

And in case you find it difficult to commit large amounts for mutual fund investments, you can start a SIP with as low as Rs 500 or Rs 1000 varying from one scheme to another. This low initial investment encourages a lot of investors to start saving early and investing in SIP for long-term returns. Some other benefits of choosing the SIP option of investing in mutual funds are:

• SIP Offers the Benefit of Rupee Cost Averaging

A major advantage of choosing the SIP option of investing in mutual funds is that you do not have to worry about timing the market in your aim to earn good returns. By committing a fixed amount, you tend to buy lesser units when the stock prices are high and more units when the prices are low. This means that you buy units during the different cycles of the market and thereby benefiting from rupee cost averaging.

• Compounding Benefit is Also Available

When you invest via SIP, the monthly returns generated on your investments are reinvested till maturity and provide you with the benefits of compounding.

• Stop Your SIP or Start a New One Anytime

Most mutual funds allow you to stop your SIP investments anytime you want or feel that you are not able to invest the committed amount. Similarly, if your income increases or you have another source of regular income you can start a new SIP and expand and diversify your investment portfolio. This option to start a new SIP anytime encourages you to use your enhanced income to make fresh investments and work to achieve your long-term goals.

Now that you are clear about What is SIP, you can choose to invest in one or more mutual funds based on your investment goals. It helps you become more disciplined in the way you spend and save. The option also offers you the advantages of rupee cost averaging and compounding thereby offering you good returns over the long term.

5 Tips to Avoid Getting Rejected by a Home Loan Company

 

 

For millions of Indians, owning a home is a lifelong ambition. However, real estate prices are increasing across the country, making it necessary to arrange for a home loan. However, extensive research and submission of required documents may fall short of getting their loan application approved for loan applicants. Before granting a loan, banks check essential criteria such as home loan ke liye documents, a good credit score, and a stable income flow to evaluate applicants.

If you are concerned about your home loan eligibility, follow the tips given below to avoid being denied a loan.

Tips for Getting a Home Loan

The following suggestions can assist you in getting a house loan secured quickly.

• Pay higher down payment

The first step an applicant can do to get his loan application approved is to make a higher down payment on the property. Even though banks can lend 80-85 per cent of the property's value as a loan amount, it is better to prepare for a higher down payment. This improves your credibility and gives them the confidence to lend, and your loan application is more likely to be approved because you have less debt.

• Apply for home loan subsidy

First-time buyers under the LIG/MIG category can check for home loan subsidy eligibility under the PMAY scheme. Qualifying under the scheme ensures you need to borrow less from the bank. This further benefits you as your repayment capacity is reviewed favourably by the potential lender allowing you to get the loan approved.

• Improve your credit score

Before issuing loans, lending institutions check the loan applicant's credit score. Those with excellent scores are often preferred. You can raise your score by taking the following steps.

• Clear all your debts before applying for a home loan.
• Paying all your credit card dues on time without fail is essential.
• You should not apply for multiple loans from different institutions as it harms your credit history.
• It would help if you did not switch jobs frequently. To qualify for a house loan, you must have a consistent and stable source of income. If you have a job, submit all essential documents for home loan eligibility for the salaried person.
  

• Apply for a joint loan

Applying for a joint home loan is another effective way to get your loan application accepted. You can file with any working family member in your family (spouse, father). This increases your chances of securing a loan. Sometimes, the applicant is over the age of 50. Banks are hesitant to lend to such applicants; in this instance, requesting a joint loan with your working son or daughter is a wise option.

Furthermore, certain institutions provide females with loan interest rate subsidies, which you can take advantage of if you apply for a joint loan with your wife.

• Apply for a long tenure

If you are new to the job and have a low starting salary, it is best to apply for a loan with a more extended repayment period. This decreases your EMI cost while also assuring the potential lender of your repayment capacity. In addition, the affordable EMI ensures that you are in the low-risk category, and your chances of obtaining a loan improve.

In addition to the suggestions mentioned above, it is critical to submitting all relevant home loan ke liye documents as requested by the lender. This will ensure that your home loan application gets cleared without issue.