The spread of the pandemic has resulted in a total lifestyle change for all of us. Our schedules had to be rewritten, our priorities had to change, and our finances had to be reassessed. Working from home meant taking a cut in the salary, while the expenses increased for various reasons.
In such a situation, not all of us have been able to manage our loan repayments and investments. Even though public banks and government gave us some concessions, managing finances has not been easy. People have started to stop and withdraw their investments in the stock market and mutual funds. Companies too are unable to distribute the required amount among the investors.
But do you need to stop your SIP payments? Is there a way you can take a break and continue after a while? Most of the leading banks and financial institutions in the country have come up with schemes for investors to reduce their load without having to withdraw money for a loss. Here is how you can manage your SIPs during this lockdown.
Digital Payments are the Same as Before
- Those of you, who wish to make investments, create portfolios, and switch between investments, will have to wait a little bit longer for the process to take place. That’s because the operational aspect of the institutions have taken a hit with the employees having to work from home.
- Most of the other functions, especially the ones that occur through the digital platform are being continued as before. If you are already used to operating your account and making payments online, there is nothing much to change. However, remember that NAV is being updated a little later than usual.
- If you make offline payments, you can still get in touch with the advisor or the distributor who will tell you what to do and how to pay online. Or, they can also initiate the payment transaction on your behalf and make the payment online.
Pause Facility Comes to the Rescue
- While you have the right to pause your SIP payments for three months, there are certain criteria you should fulfill. Considering the pandemic, financial institutions have relaxed these rules, allowing investors to get a breather.
- In fact, many of the institutions have been sending emails and messages to investors informing them about the pause facility so that they would be aware of the facility and make use of it instead of stopping payments and withdrawing the investment.
- You can use the sip calculator to get an idea about whether and how you can manage your income, expenses, and investments without taking too much strain.
It is recommended to not stop SIPs unless there is absolutely no way you will able to continue making an investment. The first step to avoiding cash crush is to pause the payments and then make a proper decision. Continuing with the investment is more likely to bring you good results in the long run.