About NPS SIP - National Pension Scheme (NPS) - Open NPS Account Online - HDFC Pension

HDFC Pension gives you a platform to invest or contribute in your NPS account through SIP (Systematic Investment Plan). In the current scenario, planning is an essential tool to diversify your funds and keep investing for your future necessities, considering the current need of subscribers we have listed certain benefits of NPS SIP.

What is SIP?

Systematic Investment Plan or SIP is a type of investment method where you can invest a fixed amount at regular intervals in an investment scheme. When a subscriber chooses to pay his/her installment amount through SIP, a fixed amount is debited from their account, depending upon the frequency chosen by the him/her and is transferred to the scheme which they’ve invested in.

Benefits of NPS SIP:

  • Inculcates the discipline of investing regularly as stated earlier, SIP investments are made at regular intervals i.e. either monthly, quarterly or every six months on a predetermined day. The SIP amount is automatically debited from an individual’s account and the amount is invested in the scheme chosen by the subscriber. This disciplinary approach of regular investments is of big advantage to the subscriber.
  • Convenience Another good thing about investing via SIP is that it’s a hassle-free process. All a subscriber needs to do is to instruct his/her bank to enable auto-debits from their account. This way the subscriber doesn’t need to go manually and pay his/her installment amount, the technology does the job for him/her.
  • Rupee Cost Averaging helps an investor beat market fluctuations and makes his/her investment averse to market volatility. When the stock prices hit rock-bottom, SIP allocates an investor more units, and allots lesser units when the stock prices soar high thereby, averaging out his/her savings.
  • Power of compounding refers to earning profits by investing your profits. In order to make most out of compounding, one must begin investing early and stay invested for a long time.
  • You can stop SIP anytime there is no fine if you decide to stop an SIP plan. If you want to stop it, you simply have to opt out of the SIP plan. This has a very big advantage over recurring deposits (RD) which usually put a fine on you if you want to stop it. After stopping your regular SIP investment, you can choose to get back the amount or let it continue to be invested.

SIP can be a good way to begin investing in NPS . This not only inculcates the discipline of saving regularly but also gives the investment a chance to grow in the long run.