In this episode, Monika dives into the debate surrounding Systematic Investment Plans (SIPs) and whether they are truly the wealth-building tool they are often made out to be. A prominent fund manager recently warned that SIPs in small- and mid-cap mutual funds may not yield the high returns investors expect, igniting a firestorm of discussion. Monika explores the claims, comparing historical returns across different asset classes and reminding listeners of the importance of long-term investing. She recounts a colleague’s decision to exit equity markets in 2020 due to short-term underperformance—only to miss out on the subsequent market boom.
Monika also breaks down the concept of rolling returns, explaining why they offer a more accurate picture of investment performance than simple point-to-point returns. Analyzing Nifty indices over different time horizons, she highlights how long-term SIP investors in well-chosen funds have generally fared well despite market volatility. She stresses that while SIPs are a great tool, they are not a magic bullet—they must be part of a well-structured financial plan that includes asset allocation, rebalancing, and a mix of equity and debt investments.
Listener questions bring in real-life concerns. Tanvi Telang, soon to be engaged, seeks advice on managing finances as a couple when incomes and money attitudes differ. Shakti Kumar wonders if four years of underperformance against the benchmark is a sign to switch funds. Lastly, Mahesh Patnala from Gurugram asks if Monika would personally manage his portfolio, expressing his struggles with long-term financial planning.
Chapters:
(00:48 - 09:37) The great SIP debate and why investors are worried
(09:38 - 12:18) Understanding rolling returns and long-term performance
(12:52 - 16:41) Managing finances as a couple
(16:44 - 17:55) When to switch funds after underperformance
(17:57 - 20:08) Finding the right financial guidance
https://www.advisorkhoj.com/mutual-funds-research/benchmark-rolling-return
If you have financial questions that you’d like answers for, please email us at mailme@monikahalan.com
Monika’s book on basic money management
https://www.monikahalan.com/lets-talk-money-english/
Monika’s book on mutual funds
https://www.monikahalan.com/lets-talk-mutual-funds/
Monika’s workbook on recording your financial life
https://www.monikahalan.com/lets-talk-legacy/
Calculators
https://investor.sebi.gov.in/calculators/index.html
You can find Monika on her social media @monikahalan.
Twitter @MonikaHalan
Instagram @MonikaHalan
Facebook @MonikaHalan
LinkedIn@MonikaHalan
Production House:www.inoutcreatives.com
Production Assistant: Anshika Gogoi
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