Just received a big bonus? The classic dilemma: should you invest it all at once (Lumpsum) or spread it out (SIP)? Let's break it down.
Invest your entire bonus immediately. Historically, more time in the market can mean better returns. Great if markets surge right after, but risky if they dip. Timing the market is tough.
Invest a fixed amount regularly over months. Leverages 'rupee cost averaging,' buying more units when markets are low. Reduces risk from volatility and emotional decisions.
Don't try to perfectly time market dips – it's almost impossible. Letting your bonus sit idle in a savings account erodes its value due to inflation. Your money should be working!
Invest 30-40% of your bonus immediately (lumpsum). Place the rest in a liquid fund and set up a Systematic Transfer Plan (STP) into your chosen equity funds. Best of both worlds!
Always ensure an emergency fund first. Avoid following the herd, ignoring your unique financial goals, or making emotional investment decisions. Stick to your personal plan.
Ready to see how your bonus can grow over time with systematic investments? Use our free SIP calculator to plan your strategy and visualize the power of compounding today!