subject: Why There Is A Need Of Systematic Investment Planning, For A Better Tomorrow [print this page] Though it is necessary to spend money for your daily existence, it is not advisable to spend unwisely, given the kind of economic situation existing in most parts of the world. Identifying a competent investment services company is the need of the hour as they can help you save money for the rainy day.
Need for Savings
Savings are necessary as it can provide a safe and secure future for you and your family. Many of us postpone investing thinking that investment planning is about saving in large volumes. The fact is you can make very small investments regularly without having to upset your monthly budget. This means that you need to make your investment planning carefully so as to build on your savings over a period of time and earn a huge profit.
Investing in a SIP
There are many investment banking companies which offer SIP as an option to build your wealth over a long term period. Most investors think that timing the investment is the key to making profits. This is completely wrong since good equity investment plans are built on the principle of buy when the price is low and sell when the price is high. It is only a SIP that mitigates your risk of investing in very turbulent market conditions.
Benefits of SIP
Investing in a SIP is very profitable since you do not have to invest in a lump sum. Investing in small amounts reduces your risk considerably. As the investment horizon is long term, the average purchase price works out less than what you would have paid otherwise for owning the same number of units. Further, it helps you in wealth creation over the long term and finally it brings in the much needed financial discipline.
