The majority of the existing business owners and employees working in an organisation do not have sufficient time to invest. They do not have the time to perform the stock market research before making investments. Systematic investment plans (SIPs) are the best way to build wealth swiftly or have a solid plan.
Setting up a SIP with a mutual fund is among the best decisions you can make for securing your future. Investing in mutual funds allows investors to accomplish their short-term and long-term goals seamlessly alongside saving the budget while inflation is running hot. However, it also comes with tax exemption benefits.
This article discusses crucial aspects of best performing mutual funds in India last 5 years and some advantages of starting the best SIP plan for 5 years. Moreover, we also highlight some of the best performing SIPs in the last 5 years that you can consider.
Key Takeaways
- You can choose the best SIP for 5 years option if you have prepared your investment goals well and have a long investment horizon.
- An SIP is a monthly investment approach that allows investors to build wealth with as little as Rs. 100.
- An SIP allows you to invest a certain amount periodically – say every month or quarter – instead of doing it at one go, which reduces the risk up to a great extent.
Learn the Basics – What is a SIP Plan?
Investing in mutual funds is always considered a good option. But when you invest a lump sum amount, you may be tempted to withdraw the money sooner than you would plan. Systematic Investment Plans or SIPs are devised: to provide a disciplined way to invest in mutual funds.
A SIP enables you to create an investment plan that lets you invest daily, monthly, quarterly, or annually. You can make decisions over how much and when to invest. The money you need for investments is always available without buying overvalued mutual funds units.
A systematic investment plan is easy to set up and automatically withdraws funds from your bank account at a regular interval to invest in mutual funds. It allows you to invest in mutual funds starting as low as Rs. 100 every month.
Most investors tend to invest in SIPs with an end date of 3 years, 5 years, or 7 years. However, this is a good idea if the investor is clear about their financial goals. However, most investors find it challenging to decide on the duration of their investment, which is the major factor in choosing the SIP type they like.
If you can keep your financial goals in mind and have an investment period of at least 5 years, investing in the best SIP plan for 5 years with a more extended end date can be lucrative. It can amplify your investment tremendously.
You must invest in these plans with the Best Sip returns in the last 5 years.
Best 5 Year SIP Plans
Every mutual fund scheme is not ideal for all investors. Best performing mutual funds in India last 5 years have done quite well. Investors have gained a 10-15% yearly return on their portfolio with the help of SIP investing in mutual funds.
If you are a new investor, it can be overwhelming to look at the multi-fund or Flexi-cap options available. While selecting the best SIP plan for 5 years, you should have a list of reliable funds with expected returns alongside their NAV (Net asset value).
We have comprehensively researched some of the Best SIP plan for 5 Years that you can opt for today:
SBI Bluechip Fund
The SBI Bluechip Fund is among the best performing SIP Plans. As the name suggests, this plan is featured by SBI and mainly invests in equity-linked instruments.
It is managed by Ms Sohini Adani, who has more than 12 years of experience in the mutual fund industry. If you invest Rs.10,000 monthly in this best SIP plan for 5 years, your investment will likely turn to Rs. 11.98 lakhs or more, subject to market circumstances.
ICICI Prudential Bluechip Fund
The ICICI Prudential Bluechip fund is among the Best SIP plan for 5 years for equities that deliver a reasonable return, with a NAV of Rs 61.4200 as of May 2022 for the Income approach its Regular plan.
Equity funds are highly volatile and thus need a long-term investment horizon to reap benefits. The expected corpus at the end of 5 years, as per ICICI Prudential’s website, is around Rs.6.29 lakhs after investing Rs.10,000 monthly.
SBI Multicap Fund
SBI Multicap from SBI Mutual Fund is an excellent alternative if you seek the most extraordinary SIP plans in equities funds. Because it invests in both stock and debt securities, it’s among the Best SIP plan for 5 years that ensures minimal risk with maximised return.
Axis Bluechip Fund Monthly SIP Plan
Are you searching for the best SIP plan for 5 years in the equities market? They have got you covered! The Axis Bluechip Fund monthly SIP plan has a proven excellent market performance record in the past few years.
It is a great option to choose as it has enabled investors to grow their investment and facilitated them to earn Rs.7.24 lakhs after 5 years with an investment of 10,000 per month.
Mirae Asset Large Cap Fund
The Mirae Asset Large Cap Fund has been one of the best SIP for 5 years, with an excellent track record concerning performance. It currently offers NAV for the Income strategy of the regular plan, which is Rs 74.4610 as of May 2022.
Investing Rs.10,000 monthly will grow your investment to Rs.6.72 lakhs after 5 years, subject to market circumstances.
Other Best SIPs for 5 years
The below-mentioned SIP plans are for the investors looking to invest in debt funds rather than equity:
Aditya Birla Sun Life Savings Fund
This fund is also one of the best SIP plans for 5 years in Debt Funds managed by Aditya Birla Sun Life Mutual Fund. The fund has provided superior returns to the investors since its inception with consistent performance year on year.
This plan gives you a higher NAV than any other debt mutual fund for a 5-year term. In May 2022, its NAV as a part of the scheme was Rs. 453.65.
SBI Magnum Medium Duration Fund
SBI Funds Management Company manages the SBI Magnum Medium Duration Fund, which is a debt fund. It has been among the best SIP plans for 5 years. According to SEBI guidelines, investing in the SBI Magnum Medium Duration Fund is classified as a Moderately High Risky fund.
L&T Low Duration Fund
If you plan to invest in debt mutual funds for the long term, L&T Low Duration Fund is a good option. The fund has delivered consistent performance since its inception in March 2010.
It is considered among the best SIP plan for 5 years with a low-risk factor. You may anticipate Rs.10,000 SIP to grow to roughly Rs.7.97 lakhs in 5 years if you start investing today.
Did you know?
- Did you know that the Association of Mutual Funds in India (AMFI) is India’s governing authority for the mutual fund industry?
Word to remember
ELSS:- Launched in 2005, ELSS is an investment scheme for tax savings. The total amount invested in this scheme will be eligible for a deduction up to Rs. 1.5 lacs from their taxable income under Sec 80C of the Income Tax Act 1961.
It is proven that SIP plans are more beneficial than lump-sum investments. If you wish to take advantage of compounding’s benefits, SIP is one great option. Best SIP to invest for 5 years will help you save your hard-earned money and make you financially stronger.
The best SIP for 5 years can enable you to fetch excellent returns from the mutual fund scheme you have invested your money in. Therefore, investors must consider executing this effective strategy to achieve their financial goals quickly.
Pros of SIP
- SIP investments have good returns over the long term.
- It develops investing skills.
- It is easy to monitor.
- It involves regularly investing small amounts, helping investors bring down the average cost.
- A great option for compounding’s benefits.
Cons of SIP
- Limited options for SIP dates
- Returns are lower in consistently rising markets
- Delay between actual execution and start/stop of SIP plan.
Frequently Asked Questions
A SIP is planned for a fixed period, after which it comes to an end and is closed. Usually, the duration of SIP investment is between one year to five years. However, one can do SIP for as long as one wants. The process is more or less the same, even if you do it for 10 years.
Investors can decide to withdraw from their SIPs by filling out a SIP stoppage form. However, if you do not make monthly instalments for 3 to 5 months in a row, the bank cancels your SIP investment plan by default.
All of your ELSS investments are subject to the lock-in period. A three-year lock-in timeframe applies to every SIP you participate in with mutual funds.
If you stop using and depositing money to your SIP plan, you will be able to claim the accrued units, but the SIP will not continue. Remember, stopping a SIP does not mean the withdrawal from the scheme. To withdraw the money you invested in SIP, you must place the request and fill out the form.
SIPs are entirely based on the stock market’s price index and movements.
