Daily SIP vs. Monthly SIP: Which One Suits You Best?
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Have you ever wondered if growing your wealth could be as simple as choosing the right investment plan? It might just be! A Systematic Investment Plan (SIP) is a powerful tool for building steady wealth over time.
There are two types of SIPs to choose from. A daily SIP lets you save a small amount regularly, while a monthly SIP offers a more consistent approach. The key is to pick the one that aligns with your financial goals. But how do you decide which option is best for you?
Both types have their own advantages. One may provide better returns, while the other could be easier on your budget. In this article, we’ll compare the two to help you make the right choice. Let's start by understanding what a daily SIP entails.
What is a Daily SIP?
A daily SIP is a systematic investment plan that allows you to invest in your chosen mutual funds every day. This method is an effective way to create wealth and work toward your long-term financial objectives with small, daily investments.
You might think this sounds like a regular SIP, and you’re right! However, there’s a key difference. In a traditional SIP, you invest a fixed amount every month on a predetermined date. On the other hand, with a daily SIP, you can invest as little as Rs. 50 every day. It’s perfect for those who have a steady income and prefer not to commit large sums at once, like in a lump-sum investment.
Let’s explore some top-performing mutual funds for starting your daily SIP.
Top 5 Daily SIP Mutual Funds
Here are five highly-rated mutual funds for daily SIP investments:
Fund Name | Launch Date | AUM (Cr) | CAGR (%) |
SBI Contra Fund | 14.07.1999 | 41,326 | 17.45 |
ICICI Prudential Value Discovery Fund | 05.08.2004 | 51,197 | 20.73 |
Parag Parikh Flexi Cap Fund | 05.05.2013 | 82,441 | 19.81 |
ICICI Prudential Bluechip Fund | 05.05.2008 | 66,206 | 15.36 |
ICICI Prudential Equity & Debt Fund | 05.11.1999 | 41,395 | 15.52 |
Now let’s take a look at monthly SIPs.
What is a Monthly SIP?
A monthly SIP, or regular SIP, is a plan where you invest a fixed amount each month on a set date. This approach gives you the flexibility to invest monthly, quarterly, or annually, depending on your financial goals.
Pro Tip: Try using an SIP Calculator to estimate your returns.
Here are five top-performing mutual funds for monthly SIP investments:
Top 5 Monthly SIP Mutual Funds in India
Fund Name | Launch Date | AUM (Cr) | CAGR (%) |
Bandhan Small Cap Fund | 01.02.2002 | 8,489 | 38.71 |
Edelweiss Mid Cap Fund | 26.12.2007 | 7,755 | 14.43 |
ICICI Prudential Large & Mid Cap Fund | 09.07.1998 | 17,464 | 18.85 |
Nippon India Multi Cap Fund | 25.03.2005 | 39,621 | 18.72 |
ICICI Prudential Manufacturing Fund | 07.10.2008 | 7,041 | 22.3 |
Daily SIP vs. Monthly SIP: A Quick Comparison
Let’s compare the key aspects of daily SIPs and monthly SIPs:
Parameters | Daily SIP | Monthly SIP |
Investment Duration | Investments are made daily | Investments occur on a set monthly date |
Size of Investment | Small daily amounts (as low as Rs. 50) | Larger monthly investments (min. Rs. 500) |
Rupee Cost Averaging | Benefits from daily investments | Benefits from monthly fixed investments |
Market Volatility | Better at managing market fluctuations | Moderate at handling market changes |
Compounding Benefits | Compounds daily | Compounds monthly |
Discipline in Investing | Daily commitment | Monthly commitment |
Convenience | Requires auto-debit for reminders | Easy to remember and manage |
Flexible Investment | More flexible | Medium flexibility |
Long-term Goals | Ideal for long-term wealth creation | Great for building wealth over time |
Conclusion
Both daily and monthly SIPs are systematic and disciplined ways to grow your wealth. If you can afford to invest Rs. 50 each day, a daily SIP might be right for you. However, if you’re saving for a specific goal and want a more manageable investment schedule, a monthly SIP could be your best bet, especially for wealth creation over the long term (5-7 years).
