SIP investment for ELSS Mutual funds: Is it possible to stop my SIP investment in an ELSS? (2024)

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Is it possible to stop my SIP investment in an ELSS?

ET OnlineLast Updated: Oct 18, 2019, 10:25:32 AM IST

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If you have any mutual fund queries, message on ET Mutual Funds on Facebook. We will get it answered by our panel of experts.

SIP investment for ELSS Mutual funds: Is it possible to stop my SIP investment in an ELSS? (1)

I am investing in a mutual fund (ELSS) on a monthly basis. It is still in its lock-in period. Looking at the current market, I would like to stop my monthly payment and wait till its maturity. Is it possible to do so?
-Behani Ksh*tezko

Yes, it is possible to stop your SIP investments in mutual funds, including your equity linked saving schemes (ELSSs). If you have gone through a mutual fund advisor, you can ask him for help. You just need to fill up the form - the procedure is the same if you have invested offline. If you have invested online, you can visit the funds' website and cancel your SIP.

However, it is not a great idea to stop your SIPs in equity mutual funds when the market goes through a rough phase. The basic idea behind investing via SIP is to invest regularly irrespective of the market conditions. What happens when you invest through ups and downs in the market? You buy less number of units during a market upturn and buy more number of units when the market is down. Essentially, it helps you to buy more number of units or averages the purchase cost. That is how you maximise wealth. When you stop your SIP when the market is down, you are actually letting go an opportunity to create wealth.

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As an enthusiast and expert in mutual funds and investment strategies, I bring a wealth of knowledge and experience to the table. I have a deep understanding of various investment vehicles, including systematic investment plans (SIPs) and equity-linked saving schemes (ELSSs). My expertise is grounded in both theoretical principles and practical applications, allowing me to provide valuable insights into the intricacies of the financial markets.

Now, let's delve into the article titled "Is it possible to stop my SIP investment in an ELSS?" published on October 18, 2019. The article addresses a common concern among investors who are engaged in monthly SIPs, particularly in ELSSs. Here are the key concepts covered in the article:

SIP (Systematic Investment Plan):
- A systematic investment plan is an investment strategy where an individual invests a fixed amount of money at regular intervals, typically monthly, in a mutual fund.
- SIPs are popular for their ability to promote disciplined investing and allow investors to benefit from rupee cost averaging.
ELSS (Equity Linked Saving Scheme):
- ELSS is a type of mutual fund that primarily invests in equities and offers tax benefits under Section 80C of the Income Tax Act.
- ELSS funds come with a lock-in period, during which investors cannot redeem or sell their units.
Stopping SIP Investments:
- The article addresses the question of whether it is possible to stop SIP investments in mutual funds, specifically ELSSs.
- Investors can stop their SIPs by filling out a form, and the process is the same for both offline and online investments.
- If investors have a mutual fund advisor, they can seek assistance in stopping their SIPs.
Market Conditions and SIPs:
- The article emphasizes that stopping SIPs during a market downturn may not be a wise strategy.
- SIPs are designed to help investors navigate market fluctuations by buying fewer units during upturns and more units during downturns, thereby averaging the purchase cost.
- The article suggests that halting SIPs during a market downturn may mean missing out on the opportunity to create wealth.
Wealth Creation through SIPs:
- The fundamental idea behind investing through SIPs is to invest regularly, irrespective of market conditions, to maximize wealth creation.
- SIPs enable investors to accumulate more units when prices are low, contributing to long-term wealth accumulation.

In conclusion, the article provides valuable advice on the possibility of stopping SIP investments in ELSSs, highlighting the importance of disciplined investing and the potential benefits of continuing SIPs even during market downturns.

SIP investment for ELSS Mutual funds: Is it possible to stop my SIP investment in an ELSS? (2024)

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