Many individuals opt for mutual funds as a long-term investment, and the number of mutual fund investors is steadily increasing.
For those unable to invest a large sum of money at once, the Systematic Investment Plan (SIP) option is available. This involves making regular contributions to mutual funds, monthly, quarterly, or daily.
However, some individuals find even the minimum investment amount too high and consequently refrain from investing.
In light of this, Life Insurance Corporation (LIC) Mutual Fund has decided to attract more investors. They now offer to start a SIP with just Rs. 100 per day, Rs. 200 per month, or Rs. 1,000 every three months (quarterly).
LIC Mutual Fund Asset Management Company has made investments accessible to a broader audience. They have reduced the daily SIP limit to Rs. 100 and have introduced a daily SIP option in the LIC MF Liquid Fund.
Other fundamental changes include setting the minimum monthly SIP limit at Rs. 200 and establishing the minimum quarterly SIP amount for specific options in the LIC Mutual Fund portfolio at Rs. 1,000.
Furthermore, the minimum step-up amount for all existing SIP schemes has been adjusted to Rs. 100. Following this initial amount, investments must be made in multiples of Rs. 1. These changes will come into effect on October 16, 2024.
The Securities and Exchange Board of India (SEBI) has introduced the Small-Ticket SIP Scheme to make mutual fund investments accessible to all segments of the Indian population.
SIP Investment Details:
Daily SIP: A minimum investment of Rs. 100 on all business days. Subsequent investments must be made in multiples of Rs. 1. Investors must commit to at least 60 installments.
Monthly SIP: Investors can choose any date between the 1st and 28th of the month. At least Rs. 200 must be invested, and subsequent investments must be made in exact rupees. A minimum of 30 installments is required.
Quarterly SIP: Investors can choose any date between the 1st and 28th of the quarter. The minimum investment is Rs. 1,000, and subsequent investments must be made in multiples of Rs. A minimum of 6 installments is required.
The LIC MF ELSS Tax Saver now has a minimum investment of Rs. 1,000. If this amount is exceeded, investments must be made in multiples of Rs. 500. A minimum of six installments is required.
Small-Ticket SIP Benefits: LIC Mutual Fund Managing Director and CEO RK Jha stated that this option aims to attract more young investors and working professionals to mutual funds.
According to a survey by the National Statistical Office (NSO), approximately 56% of the population is employed, yet only five crore individual investors had invested in mutual funds by September 2024. The introduction of small-ticket SIPs is expected to be encouraging.
Note: This article is for informational purposes only. Investing in mutual funds carries market risk, and it is advisable to seek expert advice before investing.