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When I consolidated my finances and started my investments in mutual funds, I opted for a Systematic Investment Plan (SIP) but the SIP-debits came from a lumpsum that I already had in my savings account. I think a better option would have been to park the lumpsum in a Systematic Transfer Plan (STP) and from there route the debits into the mutual fund(s) of my choice.
The SIP would be a better choice when you don’t already have a lumpsum to invest but instead rely on other regular sources of income such as your salary for the investment amount.
What do you think?
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