If you do SIP in mutual funds or are thinking of starting one, then the biggest question is how much SIP to do every month? The answer to this question is determined not only by your salary but also by your age. Many financial experts say that the right investment formula changes with age. The younger the age, the higher the risk and the more aggressive the SIP; As we age, the focus shifts to security and stability.
Financial expert Kamlesh Bhagat, in a post on his Instagram account, told how much SIP should you do at which age. Let us know-
25 to 30 years: Golden opportunity for aggressive investment
At this age, responsibilities are less and time is the biggest weapon. According to experts, at this age you should invest 30% to 35% of your income in SIP. The target should be rapid wealth creation. By investing more in equity mutual funds, you can create a bigger corpus in the long term.
31 to 35 years: Preparing for big goals
In this phase, major decisions related to marriage, home or career come to the fore. Therefore, it is important to balance the SIP a little. Kamlesh advises to invest 25% to 30% of the income at this age.
36 to 40 years: Responsibilities increase
Children’s education, household EMI and future needs become priority at this age. In such a situation, it is considered better to keep SIP between 20% to 25%. The focus is on strengthening balance and long term security.
41 to 45 years: Stability and security are important
By this age the ability to take risk starts decreasing. Experts recommend keeping SIP between 15% to 20%. The objective of investment here is stability, health cover and future security.
46 to 50 years: Preparing for retirement
Retirement is not far away. Therefore, the risk should be reduced to SIP 10% to 15%. The target in this phase is to reduce risk and strengthen retirement planning.
51 to 60 years: Focus on secure income
At this age SIP should be limited to 5% to 10%. Experts believe that now the target should be to create retirement corpus and ensure regular income through SWP.
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