A market correction could cost investors up to ₹31 lakh if SIP step‑ups are postponed— a nasty reality for those riding the 20‑year compounding curve. The figures stem from a ₹20,000 monthly SIP with a 10% annual step‑up and a 10% return assumption.
The shortfall breakdown is stark: a six‑month delay yields ₹79,000, a full‑year postponement adds ₹1.5 lakh, shifting the entire schedule by six months costs ₹16 lakh, and a twelve‑month shift totals ₹31 lakh. Each gap erodes the projected ₹3.40 crore corpus.
Aditya Agarwal, co‑founder of Wealthy.in, stresses that if a client can afford the increase, sticking to the planned schedule is best. "A correction lets you buy more units for the same money, but it doesn’t guarantee gains," he says.
Piyush Jhunjhunwala, CEO of Stockify, adds that a 10% income rise can justify a 5‑10% SIP hike—provided cash reserves and debt repayments stay under control. "It’s a balancing act between growth and liquidity," he notes.
Manish Mehta, chief business officer at SBI Mutual Fund, recommends a 10‑20% annual step‑up for long‑term goals, especially those 15‑20 years out. "Regular increases compound the corpus significantly," he explains.
Amit Kumar, head of third‑party distribution at Religare Broking, proposes a budgeting framework: allocate 50% of any income rise to SIPs, 30% to emergency funds or debt repayment, and 20% to lifestyle. He warns that conservative hybrid or debt funds may be wiser for medium‑term goals during a correction.
The consensus across experts is clear: align SIP step‑ups with income growth, respect your cash‑flow comfort, and avoid repeatedly delaying increases lest you erode your future corpus. Market dynamics will dictate when to accelerate or pause, but disciplined timing remains king.