How to start a SIP in India — a step-by-step guide
KYC, choosing a platform, picking an amount and date, and the mistakes that quietly cost SIP investors the most.
A SIP (Systematic Investment Plan) is not a product — it's just a standing instruction to invest a fixed amount into a mutual fund every month. The fund is the investment; the SIP is the delivery mechanism. Here's the whole process, end to end.
Step 1: Finish your KYC (one time, ~10 minutes)
You need to be KYC-verified once, after which every fund house accepts you.
- What you need: PAN, Aadhaar, a selfie/video, and a signature photo.
- Where: any platform (fund house website, RTA apps, or investment apps) will run video KYC for you. Status is shared across the industry via KRAs, so you never repeat it.
- Check your status at any KRA website using your PAN — many people are already verified from an old demat or insurance purchase.
Step 2: Choose where to invest from
Three broad routes:
| Route | What you get | Cost |
|---|---|---|
| Fund house website/app | Only that AMC's funds | Direct plans — free |
| RTA apps (CAMS/KFin) | Most AMCs in one place | Direct plans — free |
| Investment platforms | Everything + tracking | Direct plans on most; some sell regular plans |
Whatever you pick, insist on direct plans — same fund, same manager, lower fee. The difference compounds: see direct vs regular plans for the arithmetic.
Step 3: Decide the amount — and automate the raise
Start with an amount you won't be tempted to pause — consistency beats size. Two useful tools:
- The SIP calculator shows what a monthly amount grows to at different return assumptions.
- A step-up SIP raises your SIP by, say, 10% each year to track your salary — over 15–20 years this often adds more to the final corpus than the starting amount does.
Step 4: Pick the date and set the mandate
- The date genuinely doesn't matter — long-term SIP outcomes across the 1st, 10th and 25th differ by rounding error. Pick a date just after your salary lands.
- You'll approve a NACH e-mandate (a one-time bank authorisation) so instalments debit automatically. Set the mandate ceiling higher than today's SIP so future step-ups don't need a new mandate.
Step 5: What to actually invest in
This is the real decision, and it's about the fund, not the SIP. A common structure people use: a core of broad diversified equity (flexi cap or large cap / index) held for years, with anything satellite kept small. Research the category first, then compare funds within it — our category rankings show every fund's FundScore, returns and expense ratio side by side.
The mistakes that cost the most
- Stopping the SIP in a crash. The instalments bought during falls are the ones that create most of the final return. A paused SIP in a down year defeats the entire point of averaging.
- Too many funds. Five equity funds usually overlap heavily — you end up holding the same stocks five times with five fees. Two or three distinct mandates cover most investors.
- Judging a SIP at year one. A 12-month-old SIP has barely deployed money. Judge after full market cycles, and use XIRR — not absolute gain — to measure it.
- Regular plans by default. If you didn't consciously choose direct, you're probably paying ~0.5–1% extra every year for nothing.
NiveshLens is an independent analytics platform, not a SEBI-registered investment adviser. Everything above is education — how these products work — not a recommendation to buy or sell anything. Tax rules and rates change; verify current figures before acting.