The 7-5-3-1 rule of Mutual Fund SIPs (Systematic Investment Plans) is a simple and effective strategy to build wealth over time. Here’s how it works:
7: Invest for at least 7 years to ride out market fluctuations and benefit from long-term growth.
5: Allocate 5% to 10% of your income towards SIPs to make investing a habit.
3: Divide your investment portfolio into 3 parts:
– 50% in large-cap funds for stability
– 30% in mid-cap funds for growth
– 20% in small-cap funds for high growth potential
1: Start with 1 SIP and gradually increase the number of SIPs as your income grows.
This rule helps you:
– Develop a long-term investment mindset
– Invest regularly and consistently
– Diversify your portfolio for balanced growth
– Gradually increase your investment amount
By following the 7-5-3-1 rule, you can potentially build a sizable corpus over time, making you rich through disciplined investing.
