Systematic Investment Plans (SIPs) are designed to build long-term wealth, but many investors treat them as optional, unlike home loan EMIs that receive years of disciplined attention. Financial experts warn that this inconsistency could cost investors dearly in the long run.
“People never miss an EMI, but the same person will pause or stop a SIP the moment markets fall or a personal expense arises,” says Ritesh Sabharwal, Certified Financial Planner (CFP). “This mindset shift is crucial if we want to build financial independence.”
Home loans are viewed as mandatory. Borrowers plan every expense around EMI dates, cut back on luxuries, and often prepay when possible. This commitment, Sabharwal notes, is driven by the emotional satisfaction of owning a tangible asset—a house.
In contrast, SIPs don’t enjoy the same emotional gravity. “There’s no real discipline in how people approach investing. They treat SIPs like an expense that can be stopped anytime, which is a mistake,” says Sabharwal. Without a strong mental anchor or defined long-term goal, SIPs often fall victim to market panic or personal cash crunches.
This trend shows up in the data: many SIPs are redeemed within 1–3 years, usually around the time markets correct—ironically, when investors should stay invested. “Investors start SIPs with good intent, but panic during volatility. The irony is, these dips are the best time to accumulate more units,” Sabharwal adds.
To highlight the contrast, he offers a comparison: Paying a ₹50,000 EMI for 20 years helps repay a ₹1.2 crore loan and secure a home. But investing the same ₹50,000 in an equity SIP for 20 years, assuming a 12% return, could build wealth of over ₹5 crore. “Think about it this way: EMIs are about repaying your past; SIPs are about securing your future. But we are more committed to our debt than our dreams,” Sabharwal says.
His advice: treat SIPs like EMIs—non-negotiable and long-term. “Once you automate your SIP and stop interfering with it emotionally, compounding does the magic. All you need to do is stay the course,” he says.
With India’s rising middle class and growing financial awareness, the next leap in investor behavior must come from embracing consistency over reaction. “The financial industry talks a lot about market timing, but wealth is built by time in the market, not timing it,” Sabharwal concludes.