Investing dreams on a budget? These SIPs begin at under Rs 500

Are you eager to start investing but concerned about high entry costs? Systematic Investment Plans (SIPs) might be the solution. With SIPs, you can begin your investment journey with as little as Rs 500 per month, say experts. Here's a list of some of India's top diversified equity funds, ranked by their five-year returns.

1. Nippon India Small Cap Fund

• Category: Equity
• Market cap: Small Cap
• AUM (Assets Under Management): Rs 37,374 crore
• Minimum investment: Rs 100
• Current value: Rs 13.84 lakh
• Annual return: +34.23 per cent

2. SBI Small Cap Fund

• Category: Equity
• Market cap: small cap
•  AUM: Rs 21,320 crore
•  Minimum investment: Rs 500
•  Current value: Rs 11.56 lakh
•  Annual return: +26.60 per cent

3. Invesco India PSU Equity Fund

• Category: Equity
• Market theme: PSU (Public Sector Undertakings)
• AUM: Rs 549 crore
•  Minimum investment: Rs 500
• Current value: Rs 11.02 lakh
• Annual return: +24.57 per cent

4. SBI Technology Opportunities Fund

• Category: Equity
• Market sector: Technology
• AUM: Rs 3,262 crore
• Minimum investment: Rs 500
• Current value: Rs 10.51 lakh
• Annual return: +22.70 per cent

5. Tata Equity PE Fund

• Category: Equity
• AUM: Rs 6,093 crore
• Minimum investment: Rs 500
• Current value: Rs 9.59 lakh
• Annual return: +18.83 per cent

"These funds span various market segments, and each presents an opportunity for investors with a long-term horizon. Whether you are looking to build wealth, save for a specific goal, or plan for your retirement, the key to a successful SIP journey lies in understanding your financial goals and risk tolerance," said Aastha Gupta, CEO, Share India FinCap.

Diversify your investments across mutual fund categories to align with your objectives. "For instance, if your aim is to secure your child's education fund over the next 15 years, an equity mutual fund might offer the potential for substantial returns over the long term," she added.

Once you have a clear understanding of your financial goals, determine the SIP amount that suits your budget. This is a critical step as you should choose an amount that you can commit to for the long haul.

Most SIPs offer a monthly investment frequency, but some also allow quarterly and weekly contributions. Select the frequency that aligns with your financial situation and investment plan.

Selecting the right mutual fund scheme is crucial, and consulting with a financial advisor or conducting thorough research can help you make an informed decision.

Registration for a SIP can be done online via the fund house's website or through your demat account. Alternatively, you can visit the fund house's office or an authorised distributor to get started.

"Remember to regularly review your investments, ideally at least once a year, to ensure they remain on track with your financial goals. This periodic assessment will help you gauge your progress toward your objectives," said Amit Gupta, MD, SAG Infotech.

"SIP investments are designed for the long term and offer benefits such as rupee cost averaging and the ability to withstand market fluctuations. As a beginner, starting with a small investment and gradually increasing your SIP amount can be a prudent approach," he added.

In addition to these steps, experts advise to seek the guidance of a financial advisor, stay informed about market conditions, and stay focused on your financial goals. Over time, your SIP investments can grow into a substantial corpus, allowing you to achieve your aspirations and secure your financial future.