Delhi

🚀 Are These 4 SIP Mistakes Silently Destroying Your Long-Term Wealth? | Avoid Losing Lakhs in Compounding Gains

1️⃣ Stopping SIPs During Market Corrections (Biggest Wealth Killer)

• Why it hurts:

  • SIPs work on Rupee Cost Averaging, buying more units at lower NAVs.

  • Stopping SIPs during dips results in 10–25% lower long-term portfolio value (historically seen in major market corrections).

• Expert Insight:

  • Ronak Morjaria (ValueCurve Financial Services) warns that negative years are the best years to accumulate units, not stop investing.

• Financial Impact Example:

2️⃣ Redeeming Too Early (Cutting the Compounding Engine)

• Why early exit damages returns:

  • First 3–5 years = Seed Stage, not high-return stage.

  • Compounding accelerates only after year 5.

• Long-Term Growth Curve:

• How much you lose:

  • Exiting early can reduce total corpus by 30–40% over 15 years.

• Pro tip:

  • Avoid checking portfolio frequently—let compounding work “silently”.

3️⃣ Switching Funds Frequently (Hidden Costs + Tax Losses)

• Why chasing returns is dangerous:

  • Each switch triggers:

    • Exit loads (up to 1%)

    • Short-term/long-term capital gains tax

    • Loss of unit compounding

• Financial drag from over-switching:

• Rule:

  • Stick to 3–5 years before judging a fund’s real performance.

4️⃣ Holding Too Many Schemes From the Same Fund House

• Why it creates hidden duplication:

  • AMCs follow similar philosophies → same stocks across multiple schemes.

  • Leads to overexposure, higher risk, and no real diversification.

• Expert View (Ronak Morjaria):

  • Understand investment style before investing; avoid clustering holdings in one fund house.

• Optimal Structure:

🔍 Financial Takeaway

Your SIP can grow into crores—but only if you avoid emotional reactions, unnecessary switches, and poor scheme choices.

📝 Disclaimer

This article is for educational and informational purposes only. It should not be considered investment, financial, or tax advice. Mutual fund investments are subject to market risks; investors should consult a SEBI-registered financial advisor before making investment decisions. The Profit India is not responsible for any financial losses arising from decisions based on this content.

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