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

https://aria.org.in/

If you have financial questions that you’d like answers for, please email us at ⁠[email protected]⁠ 

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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