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Starting a Systematic Investment Plan (SIP) with just ₹100 provides an accessible way to begin investing in mutual funds, making it suitable for first-time investors or those with limited budget. This approach encourages disciplined saving habits and financial inclusion by allowing even those with lower incomes to participate in wealth creation. The power of compounding significantly enhances the value of these small, regular contributions over time, while rupee cost averaging helps mitigate market volatility by spreading out the investment cost. SIPs are flexible, allowing adjustments in contribution amounts and automated deductions for convenience.
UTI Mutual Fund supports investors in achieving these goals with its expertise and diverse range of investment options. With over 6 decades of experience, UTI MF provides equity, debt, hybrid and other schemes tailored to different risk profiles and objectives. Our customizable SIPs provide access to professional fund management and diversified portfolios aimed at growth. Read to learn more about ₹ 100 SIP and how it is a suitable option for beginners.
Why Start an SIP with Rs 100?
Starting a Systematic Investment Plan (SIP) with ₹100 is a strategic move for many investors, especially those new to investing or with limited financial resources. This modest amount serves as a pocket-friendly entry point for several reasons. Here are some benefits of 100 Rs SIP.
Firstly, it makes investing accessible to a broader audience, including students, young professionals, and individuals from lower-income groups. By lowering the barrier to entry, more people can participate in the financial markets, promoting financial inclusion and literacy.
The ₹100 SIP also instils disciplined saving habits. Regular contributions, even if small, encourage disciplined investing behaviour and help investors avoid the pitfalls of market timing. This consistency benefits from the principle of rupee cost averaging, where investors are allocated more units when prices are low and fewer when prices are high, thereby averaging the overall cost per unit over time.
Moreover, starting with ₹100 allows investors to leverage the power of compounding. Over time, these small investments can grow significantly, as the returns generated are reinvested to generate additional returns under the growth plan. This process is particularly effective over long periods, making it ideal for achieving long-term financial goals such as retirement planning or children’s higher education.
Benefits of Investing ₹ 100 in SIP Monthly with UTI Mutual Fund
Choosing UTI Mutual Fund for an SIP of ₹100 has the potential to provide several compelling benefits catering to both new and seasoned investors. UTI Mutual Fund is one of India's oldest and trusted asset management companies, with over 6 decades of experience, providing a reliable platform for your investments.
Here are the benefits of starting SIP with ₹100.
Wealth Creation Potential : By investing with a small amount, you can get exposure to various asset classes and can aim to grow your wealth in the long term.
Professional Management : With UTI MF, you benefit from expert fund management and research-backed investment strategies. This professional management aims to optimize returns while managing risks effectively.
Rupee Cost Averaging : By investing regularly, SIPs help mitigate market volatility through rupee cost averaging. This approach allows investors to buy more units when prices are low and fewer when prices are high, potentially lowering the average cost per unit over time.
How Much Can ₹100 Grow? 100 Rs SIP Calculator
Investing ₹100 monthly through an SIP can lead to significant growth over time, thanks to the power of compounding and disciplined investing. Using an SIP calculator , we can calculate how this modest investment can grow over different periods with an assumed annual return rate.
Let us consider an assumed annual rate of 12% and see how much potential wealth can be accumulated over the long term.
5 Years
Over five years, a ₹100 monthly SIP can grow to approximately ₹8,100 at 12% assumed rate of return*. This growth is driven by the disciplined investment and the compounding returns earned on the accumulated amount.
10 Years
Extending the investment period to ten years, the same ₹100 monthly SIP can grow to around ₹22,404 at 12% assumed rate of return*. The impact of compounding becomes more pronounced as the investment horizon lengthens.
20 Years
Over a twenty-year period, the ₹100 monthly SIP can accumulate to approximately ₹91,986 at 12% assumed rate of return*. This substantial growth illustrates how small, regular investments can lead to significant wealth creation over time.
Factors To Consider Before Investing in Funds With ₹100 Minimum SIP
Before investing in a mutual fund SIP plan with a ₹100 minimum amount, several factors should be considered to help it align with your financial goals and risk tolerance.
Investment Goals and Horizon : Determine whether your objective is short-term parking of idle funds or long-term capital appreciation. This will guide you in selecting the appropriate mutual fund type, such as equity funds for long-term growth or debt funds for relatively stability.
Risk Appetite : Assess your willingness to take risks. Equity funds have the potential to provide higher returns but come with greater volatility, making them suitable for those with a higher risk tolerance. Conversely, debt funds are less volatile but typically provide low returns.
Fund Performance : Examine the historical performance of potential funds. Look for returns and the ability to outperform benchmarks and peers over different market cycles.
Expense Ratio : Consider the cost of managing the fund. A lower expense ratio means less of your money is spent on fees, which can significantly impact your overall returns over time.
Use of SIP Calculator : Employ an SIP calculator to calculate potential corpus based on different time periods, helping you plan your SIP investments better.
Mutual Funds to Invest With ₹100 Minimum SIP
Investing in mutual funds with a minimum SIP of ₹100 can be a suitable way for small investors to enter the market. Here are some category options to consider.
Equity Funds - These funds invest predominantly in stocks across market capitalisations and sectors. They provide long-term growth potential but may be volatile in the short term. Minimum SIP may be as low as ₹100 for certain equity funds.
Debt Funds - These funds invest in fixed-income instruments like bonds, government securities etc. They provide a relatively stable return potential with relatively lower volatility compared to equity funds.
Hybrid Funds - These funds invest in both equities and debt with the fund manager aiming to balance risk and returns potential.
Sectoral/Thematic Funds - These funds invest in specific sectors or themes like technology, infrastructure etc. which are expected to grow rapidly. They are associated with a higher level of risk but also provide the potential for higher returns.
Thus, investors looking to start SIPs have multiple mutual fund categories to choose from based on their risk appetite and investment goals.
FAQs for SIP at Rs.100:
What is the minimum amount to start a SIP with any Mutual Fund?
The minimum amount to start a Systematic Investment Plan (SIP) with any Mutual Fund generally begins at ₹500 per month. However, certain schemes may allow minimum SIP investment of ₹100. Check the specific fund's Scheme Information Document for details before investing.
What are the advantages of ₹100 Monthly SIP?
Investing ₹100 monthly through an SIP allows you to start your investment journey with minimal financial commitment. It helps inculcate a disciplined saving habit, allows for rupee cost averaging, and provides the benefit of compounding over time. This approach is particularly beneficial for new investors or those with limited disposable income.
How do you choose mutual funds with ₹100 Monthly SIP before investing?
When choosing the suitable funds for a ₹100 monthly SIP, consider the fund's historical performance, expense ratio, risk level, and your financial goals. You may research various fund categories like equity, debt, or hybrid funds and assess their alignment with your investment objectives, time horizon and risk tolerance.
How to invest in mutual funds with Monthly ₹100 SIP?
To invest in mutual funds with a ₹100 monthly SIP, first select a fund that allows this minimum investment option. You can invest through online platforms or directly via the fund house's website. Complete the KYC process, set up an account, and choose the SIP amount and duration to start investing.
How much can ₹100 SIP grow per month for 20 years?
The growth of a ₹100 SIP over 20 years depends on the average annual return rate of the chosen mutual fund. Assuming an average annual return of 12%, your investment could grow to approximately ₹91,986 due to compounding*. Use an SIP calculator to estimate potential returns based on different rates.
How much can ₹100 SIP grow in 5 years?
For a ₹100 SIP over 5 years, assuming an average annual return of 12%, your investment could grow to approximately ₹8,110*. The exact amount will depend on the fund's performance and market conditions. Utilize an online SIP calculator for projections based on different scenarios.
Can I change my SIP amount later?
Yes, you can change your SIP amount later if needed. Most mutual funds allow investors to modify their SIP contributions by submitting a request through their online platform or by contacting customer service. It's advisable to review the terms and conditions regarding changes in SIP amounts.
How is ₹100 SIP beneficial for long-term goals?
A ₹100 SIP has the potential to be beneficial for long-term goals due to the power of compounding. Over time, even small investments can accumulate into significant amounts. It helps in building a disciplined saving habit and allows you to gradually increase your investment as your income grows.
Who should look to invest in a Mutual Fund SIP of ₹100/month?
A Mutual Fund SIP of ₹100/month is ideal for beginners, students, or individuals with limited disposable income who wish to start investing without financial strain. It suits those looking to cultivate a saving habit while gaining exposure to market-linked returns over time.
How to invest in ₹100 SIP with UTI Mutual Fund?
Want to invest in a ₹100 SIP with any Mutual Fund? You can initiate investments through any MF's official website or authorized platforms by completing KYC requirements, selecting the scheme, and setting up an automatic monthly debit from your bank account.
*Above assumed rate of return 12 % is for illustration purpose only and for equity-oriented scheme returns only. The calculations are not based on any judgements of the future return of the equity market / sectors or of any individual security and should not be construed as promise on minimum returns and/or safeguard of capital. Please consult your financial advisor before taking any investment decision. Returns are calculated by taking mean of 10 years rolling returns of Nifty50, which is at 12.42%, between the 01/06/2014 and 31/05/24. Past performance may or may not be sustained in future. Mutual fund schemes do not provide guaranteed returns.
SIP is a feature offered for disciplined investment of a certain amount on a pre-decided date in a specific mutual fund scheme, regularly over a period of time.
The minimum amount for SIP may vary across schemes and asset management companies. Please check the Scheme Information Document for details.
Disclaimer:
The information set out above is included for general information purposes only and is not exhaustive and does not constitute legal or tax advice. All complaints regarding Mutual Fund can be directed towards visit www.scores.gov.in (SEBI SCORES portal). Readers are requested to make informed investment decisions and consult Chaitanya Financial Consultants – 9000628943 / mfd.mmr@gmail.com to determine the financial implications with respect to investing in Mutual Funds.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
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