Investing in the Indian stock market through Systematic Investment Plans has been gaining popularity of late. Wondering what an SIP is?

A Systematic Investment Plan, or SIP for short, is a method of investing, whereby you are required to make regular contributions of a fixed amount for a certain period of time. Once a specified tenure ends, you can withdraw the amount in the fund and use it as you wish. These contributions are invested in individual stocks of companies or mutual funds.

You may be wondering how long you can invest in an SIP, aren’t you? In this article, we’ll examine whether you can invest in an SIP for a long time, like 30 years or more.

Systematic Investment Plans usually require you to complete an application form when you begin investing. In the application form, you will be asked to specify the duration of your investment. In general, the most common tenures for mutual funds are 5 and 10 years. However, depending on the mutual funds you wish to invest in, fund houses may even allow you to invest for longer durations.

However, what if you want to invest in a SIP for longer than those tenures? Like say 30 years? Will you have to open a new SIP once the previous one expires? Not at all.

Here is where the concept of perpetual SIPs comes into play. As the name implies, perpetual SIPs have no end to their tenure. When you fill out your application form, you can choose perpetual SIPs. You don’t have to worry about tenures at all with perpetual SIPs. You can stay invested as long as you want.

There are no restrictions on closing a perpetual Systematic Investment Plan. You can even withdraw funds after just a few months without incurring any penalties.