Should I step-up SIP contributions for only a limited time?

Dhirendra Kumar explains why it is important to invest in a systematic manner

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Is it fine to step-up SIP contributions only for a limited time?
- Agrawal

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No. The whole idea is that you should be systematic with your investments. And, this is not being systematic and in fact this is trying to predict the timeliness. If at all you have some extra money which has come your way, just spread it over a period of time. If you have received an annual bonus, spread it over six months. If you have got a sizeable amount of money which has been realised on selling an asset, spread it over the next three years. Be methodical and systematic.

The moment you do these things like investing more during a brief period of time, you are expecting that the market is relatively cheap. These kind of things has not worked. In the last one year or so, I have come across many investors who have been waiting for correction. They have been waiting for a market fall and while they have been waiting, the market has gone up by 30 per cent.

If you are investing for the long term and you are methodical about it, most of the return can be derived from the market. If you try and do all this, you may succed sometime, but that will develop a false belief which will take you in the wrong direction.

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