SIP: How to open an SIP account online? A step-by-step guide to follow

Mutual fund investment through systematic investment plans (SIPs) has gained popularity in the last few years as it lessens market risk, balancing out losses once the market recovers.

Address proof, PAN card, and ID proof are required to open an SIP account. Image: Freepik/Representational

SIPs make you invest small amounts at regular intervals to purchase mutual fund units. This promotes discipline in your investment practices. If you routinely overspend and underinvest, SIPs can help you get back on track.

Mutual fund investment through systematic investment plans (SIPs) has gained popularity in the last few years as it lessens market risk, balancing out losses once the market recovers. Secondly, mutual funds invest their pool in a wide variety of stocks, which also reduces market risk even if some of those stocks fare poorly.

If you want to start investing in SIPs and are struggling to open an account online, here is a step-by-step guide you can follow to open an account within minutes.

ALSO READ: Three situations when you should review your financial plan! Explained

Documents
First of all, get all the documents required to open an online SIP account. These include address proof, your PAN card, and ID proof.

Along with other documents, provide the correct bank account number and details. You can also provide copies of your passport or driving licence as ID proof. Make sure that they meet the existing Know Your Customer (KYC) rules set by the government.

KYC
Once all the documents are ready, you need to complete the KYC (know your customer) request before starting to invest. For that, you need to fill an application form either at a bank or a post office, or you can also do it online.

SIP Sign In
After KYC, register yourself with an Indian broker or a financial advisor. After registration, you can choose any SIP plan you want to invest in.

Select Date
Choose a date at your convenience. You can choose any date in a single month for different SIPs.

Submit Your Form
Once you've decided on a mutual fund firm, you may start a SIP by completing the paperwork online or offline, depending on your fund house. You can submit your SIP online if you already have a Demat account. You may also send it through the post office or the bank.

Things you should consider before starting to invest in an SIP
Before you start investing in any of the SIPs, you should think about your risk appetite, get some financial advice from an expert, calculate returns, aim for investing, decide an amount to be invested, etc.

ALSO READ: EPFO Alert: Why EPFO freezes PF accounts and bars withdrawals — Here's how to withdraw savings from frozen account

TAGS:

SIP Accounts mutual fund