The fund you pick will matter less than three duller choices: the plan type, the date, and whether you keep going in red months.
Short answer: a SIP is an automatic monthly purchase of mutual fund units — start with an amount you can sustain through a bad month, on a date right after salary credit, in a direct plan (no distributor commission — the ~1% annual difference compounds to about ₹30,70,539 on a ₹10,000 SIP over 25 years). A broad index fund is a defensible first fund precisely because it removes the picking problem. Our SIP pages show what each amount historically became.
Return figures are assumptions for illustration, not predictions · Indicative, as of August 2026
One-time setup: KYC (PAN + Aadhaar, fully online), a fund platform or the AMC's own site, a bank mandate (an auto-debit authorisation), pick fund, amount, date. Total time: under an hour; recurring effort: zero — which is the entire design. Two settings matter more than they look: direct plan (see below) and growth option (not IDCW/dividend — payouts interrupt the compounding you came for and create tax events besides).
The same fund exists in two versions: regular (embeds a distributor's commission in the expense ratio) and direct (doesn't). The gap is commonly 0.5–1% a year — invisible monthly, monstrous compounded: at a 1% drag, a ₹10,000 SIP over 25 years surrenders roughly ₹30,70,539 versus the direct version of the identical portfolio. Nothing you will ever click is better paid than choosing the word "direct". (If you genuinely use and value an advisor, pay them a visible fee instead — just know the regular plan is a payment, not a favour.)
Your first SIP's job is not maximum return — it is surviving your inexperience. A broad-market index fund (Nifty 50 or similar) removes the two decisions a beginner is worst equipped to make: which manager, and when to fire them. It cannot beat the market and cannot badly trail it either, its expense ratio is the lowest on the shelf, and it turns every "is my fund good?" spiral into a non-question for years. Add complexity later, when the habit is proven and the amounts justify it; plenty of investors sensibly never do.
Start where continuation is certain — ₹2,000 sustained beats ₹10,000 abandoned in month seven, because the habit, not the first year's corpus, is the asset. The amount pages make the long arithmetic vivid: the difference between outcomes is overwhelmingly years, not cleverness. Then the one behaviour that decides everything: red months are the SIP working — the same ₹5,000 buys more units when prices fall, which is the entire mathematical advantage of averaging. The investor who pauses in downturns keeps the risk and donates the mechanism. Automate on salary-day-plus-one, stop checking weekly, and increase the amount with every raise before lifestyle absorbs it — the first-salary checklist puts this in the full sequence.
An amount you can continue through a bad month without drama — ₹2,000–5,000 is a common honest start. Consistency compounds harder than size; increase with each raise instead of starting at a heroic number.
Identical portfolio, different cost: regular plans embed a distributor commission of roughly 0.5–1% a year. On a ₹10,000 monthly SIP over 25 years, that drag is worth around ₹30,70,539 — choosing 'direct' is the single best-paid click in investing.
A broad-market index fund is the defensible default — lowest cost, no manager risk, no fund-comparison spiral. It guarantees the market's return, which over long periods has been the bar most alternatives fail to clear.
That is the one month you most shouldn't — falling prices mean the same instalment buys more units, which is the entire point of averaging. Pausing in downturns keeps equity's risk while surrendering its mechanism.
Related: SIP outcomes by amount · SIP Calculator · Emergency fund first
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Written and checked by the PaisaSamajh editorial desk · Last reviewed: 24 August 2026 · How we check this →