What happens if I cancel my SIP? | Help & Support (2024)

FAQs

What happens if I cancel my SIP? | Help & Support? ›

Canceling your SIP before maturity simply means that you are discontinuing future investments. It does not affect the units you have already purchased through your existing SIPs, and they continue to be part of your investment portfolio.

Any amount already invested in the fund will continue to remain invested. Canceling the SIP will only stop future installments. You may redeem the invested amount via your Mutual Funds dashboard.

No, There are no charges/penalty for stopping an SIP in a scheme. It is completely a free of cost facility. Does SIP stop automatically redeem the invested amount also? No, SIP stop just cancels the future auto debit from the bank account.

You may cancel your mutual fund SIPs offline by notifying your bank and the respective AMCs. You can also have your mutual fund agent do it for you. Request a SIP cancellation form from your asset management firm or through online Mutual Fund Registrar and Transfer websites such as CAMS and KFin Technologies Limited.

Can I withdraw my SIP anytime? Yes, you can withdraw money from your SIP anytime. However, there are a few exceptions. For instance, ELSS has a lock-in period of three years, while a children's savings fund exhibits a lock-in period of 5 years.

According to tax and investment experts, new age investors flocking to stock market and catch the rally is one of the major reasons for mutual funds SIP getting paused or closed in Indian mutual funds industry.

SIPs can be a good or bad investment depending on individual circ*mstances and goals. It is essential to weigh the pros and cons carefully before deciding to invest in SIPs. Remember, investing is a long-term journey, and it is crucial to stay informed and make decisions that align with your financial objectives.

Also, the investor must visit the bank and fulfil the NACH mandate by requesting the bank to cancel the SIP. Once the investor submits the written confirmation from the bank to the AMC, the biller will be removed from the system. After these steps, no SIP deductions will be made from the investor account.

SIP Withdrawal Charges with Example

For instance, if you withdraw your SIP investment within a year from the date of investment, the mutual fund may charge an exit load ranging from 0.5% to 2% of the redemption amount. In the case of investment through SIP, every instalment is treated as a fresh purchase.

Rishabh Parakh, Chief Play Officer, NRP Capitals explains, “SIPs must not be stopped given the market highs and should only be stopped in case there is a change of financial goals or future earnings but market high lows are not in anyone's control.

Can I cancel my SIP online? ›

Online SIP cancellation

You must first login to the mutual fund website using login credentials where your SIP is continuing. It helps if you have the folio number, bank account number associated with the folio and PAN handy for your login credentials. It may take some time for your SIP to get cancelled.

SIPs work like recurring investments, where this amount is auto-debited from your bank account and invested in the mutual fund of your choice. Once the amount is deposited, you get a certain number of units of the mutual fund scheme where you have invested.

As login information for the mutual fund website, the investor would need their folio number, the bank account number associated with their folio, and their PAN. After that, the investor must select the ongoing SIP they want to discontinue and click “Cancel SIP.” Within a few days, the SIP will be discontinued.

You can use the services of your broker or distributor if you have invested in mutual funds through them to withdraw the amount from your SIP. Speak with your distributor or broker and provide them with the information they need, including your investment amount, scheme name, and folio number.

Yes, you can typically withdraw money from an existing Systematic Investment Plan (SIP). However, there are certain conditions and procedures you need to follow, which may vary based on the mutual fund company and the specific SIP.

Long-term gains up to Rs. 1 lakh are tax-free. The balance units shall be considered as short term as the units were held for less than a year on the date of redemption. Short-term gains from SIPs redeemed within a year are taxed at a 15% flat rate, with additional cess and surcharge.

Pausing an SIP may be a better option if you have a short-term cash flow issue and you plan to restart your investment in the future. By pausing, you can temporarily stop the contribution to your SIP without closing your account, and you can resume the investment at a later date.

It may take some time for your SIP to get cancelled. However, SIP deductions stop after the waiting period. Your mutual fund investments remain in the fund until you place a redemption or a switch request.

However, you can only suspend a SIP temporarily for two months. Post that, if you give no initiation to the bank to restart the SIP, the SIP will be cancelled automatically by the Asset Management Company. herefore, you must avoid skipping the SIP payments for over two months.

SIP pause allows you to suspend your contributions for various reasons temporarily. Unlike cancelling a SIP, it allows investment growth during the pause period if the Mutual Fund performs well. It provides flexibility for reassessing strategies or managing financial constraints while maintaining investment continuity.