Introduction: The Smartest First Step Toward Wealth
Have you ever wondered how some people manage to build wealth without taking huge risks? The answer often lies in a simple yet powerful habit—Systematic Investment Plan (SIP). In this blog, I’ll walk you through exactly how to start SIP in a step-by-step format. We’ll explore its benefits, how to choose the right mutual fund, and how it can help you achieve your long-term financial goals.
But first, let me introduce you to Arjun—a young professional who turned his financial life around with SIP. Arjun’s story will unfold as we dive deeper into each section. So stay tuned!
“Arjun’s story is not over yet… you’ll discover how his dedication to SIP changed his future later in this article. Keep reading!”
What is SIP?
A Systematic Investment Plan (SIP) allows you to invest a fixed amount of money regularly (monthly or quarterly) into a mutual fund scheme. This approach builds the habit of disciplined investing and helps you create wealth steadily.
With SIP, you don’t need to time the market. Instead, your money gets invested at different market levels, helping you average the cost.
Why SIP?
Easy and automated
Great for long-term wealth creation
Flexible and low starting amount
Harnesses the power of compounding
Selecting a good mutual fund is the key so that your SIP in it can work wonders.
How Does SIP Work? (With Table)
Let’s assume you invest ₹10,000 per month in a mutual fund through SIP with an average annual return of 12%:
| Year | Monthly SIP | Total Invested | Estimated Value (12% Returns) |
|---|---|---|---|
| 5 | ₹10,000 | ₹6,00,000 | ₹8,24,000 |
| 10 | ₹10,000 | ₹12,00,000 | ₹23,22,000 |
| 15 | ₹10,000 | ₹18,00,000 | ₹50,58,000 |
| 20 | ₹10,000 | ₹24,00,000 | ₹1,01,78,000 |
This is the power of compounding—your money earns returns, and then those returns earn more returns.
Step-by-Step: How to Start SIP in India
Step 1: Know Your Financial Goals
Before you invest, ask yourself: Why am I investing? Is it for your child’s education, your retirement, or buying a home?
Arjun’s Story Continues: Arjun wanted to fund his MBA without a loan. So he began investing ₹10,000/month when he turned 23. This clarity helped him stick to his goal.
Step 2: Assess Your Risk Capacity
Your age, income, and responsibilities determine how much risk you can take.
Low Risk: Debt Mutual Funds
Medium Risk: Hybrid Funds
High Risk: Equity Mutual Funds
Selecting a good mutual fund is the key so that your SIP in it can work wonders.
Step 3: Choose the Right Mutual Fund
Picking the right fund aligned with your goals is crucial. I recommend reading our detailed blog: Best Mutual Funds to Invest in 2025 – Top 5 High-Growth Picks
Step 4: Choose SIP Amount and Duration
Start with what you can afford. Even ₹10,000 monthly can turn into crores in the long run. Use SIP calculators for clarity.
How to Use a SIP Calculator (Your Planning Assistant)
A SIP calculator helps you estimate how much your investments can grow over time. Here’s how to use it:
Enter Monthly SIP Amount – How much will you invest every month?
Set Investment Duration – How many years do you plan to invest?
Enter Expected Annual Return (%) – Usually, equity mutual funds offer 10–14%.
View Result – The calculator shows total invested amount, estimated returns, and final wealth value.
Pro Tip: Use the calculator to adjust the SIP amount or tenure until it aligns with your financial goal.
👉 Try our WealthVichar SIP Calculator now and plan your SIP smartly.
Step 5: Start Your SIP
You can easily start a SIP through:
Mutual fund websites
Investment platforms like Groww, Zerodha, Paytm Money
Your bank
Real Comparison: SIP vs. RD (Recurring Deposit)
| Particulars | SIP (Equity Fund, 12%) | RD (6.5%) |
| Monthly Investment | ₹10,000 | ₹10,000 |
| Tenure | 15 years | 15 years |
| Total Invested | ₹18,00,000 | ₹18,00,000 |
| Estimated Returns | ₹50,58,000 | ₹26,21,000 |
Clearly, SIP creates far more wealth in the long term.
FAQs on How to Start SIP
1. What is the minimum amount required to start a SIP?
You can start a SIP with as little as ₹500 per month. However, to witness meaningful compounding, a higher amount like ₹5,000–₹10,000 is more effective.
2. Can I change my SIP amount later?
Yes, you can increase, decrease, or even pause your SIP as per your convenience. Many platforms offer a step-up SIP option to increase it annually.
3. Which mutual funds are best for SIP in India (2025)?
It depends on your financial goal and risk appetite. Equity funds like large-cap and flexi-cap funds are among the top choices. Check our Best Mutual Funds to Invest in 2025 article.
4. Is SIP better than FD or RD?
Yes, in the long run, SIPs have historically offered higher returns than fixed deposits or recurring deposits, although with more market-linked risk.
5. How long should I continue my SIP?
Ideally, for long-term goals like retirement, child education, or wealth creation—anywhere from 5 to 20+ years to truly leverage compounding.
6. What happens if I miss an SIP instalment?
Nothing major. One missed SIP doesn’t affect your investment severely, but consistency is key to long-term growth.
7. Where can I calculate SIP returns accurately?
Use our free online SIP return calculator at WealthVichar to plan your investment journey smartly.
8. How do I use a SIP calculator?
Simply enter your monthly SIP amount, investment duration, and expected annual return. The calculator will show how much your money can grow and help you set realistic goals.
Why You Shouldn’t Stop Your SIP
Even during tough times, continuing SIP pays off in the long run.
Back to Arjun: There was a time when Arjun had to cut down on outings and reduce online shopping just to keep his SIP going. But he didn’t stop. At age 30, his SIP portfolio helped him pay his MBA fees without a loan. Today, he continues investing with even more confidence.
Bonus: Tips for First-Time SIP Investors
Start Early: The earlier you start, the better the compounding.
Stay Consistent: Don’t stop SIPs due to market volatility.
Review Yearly: Track performance but don’t panic over short-term dips.
Automate: Set auto-debit to stay disciplined.
Other Helpful Blogs You Should Read
How to Save Money: A Step-by-Step Guide to Financial Security
Best Mutual Funds to Invest in 2025 – Top 5 High-Growth Picks
Final Thoughts
If Arjun could do it with just ₹10,000 per month, imagine what you can do by starting your SIP today. Remember, every great financial journey begins with a single step. Don’t delay.
This blog is meant for educational purposes only. Please consult with a SEBI-registered advisor before investing.
At Wealth Vichar, we’re here to simplify your money journey. Whether it’s SIPs or saving taxes, we help you make smart, confident financial decisions.
Now it’s your turn—what’s stopping you from starting your SIP today? Let me know in the comments below!