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Introduction
SIPs (Systematic Investment Plans) are built on consistency. But emotions often disrupt this path — fear during market crashes or greed during bull runs can tempt investors to stop or change SIPs. Building emotional discipline means sticking to your plan even when markets are noisy. In this blog, we explore how one investor stayed the course — and how you can too.
15/06/2025
SIPs work best when:
You ignore short-term volatility
You keep investing regularly, even during downturns
You trust the power of compounding and market cycles
🚫 But many investors panic and pause SIPs during a correction — losing the chance to buy at lower prices.
Real-Life Example: Neha’s SIP Discipline During COVID Crash
In March 2020, when markets fell over 35%, Neha, a 30-year-old teacher, continued her SIP of ₹5,000 in an equity mutual fund. Her friends paused theirs, waiting for the "right time."
By 2023, her SIPs had averaged a CAGR of 13.4%, thanks to units bought at low NAVs. Her friends re-entered later and earned only 8.2% CAGR.
How to Build Emotional Discipline in SIPs
| Tip | Why It Works |
|---|---|
| Set clear goals | Keeps focus on purpose, not panic |
| Automate SIPs | Removes emotion from the equation |
| Avoid checking NAV daily | Reduces fear and reactive behaviour |
| Follow asset allocation | Balances risk and improves confidence |
| Track annually, not monthly | Helps you stay long-term focused |
Conclusion
The best SIP investors aren’t the smartest — they’re the most consistent. Stay committed, trust the process, and let time reward your discipline.
Stay emotionally strong. Don’t stop SIPs because of market noise. Automate, focus on goals, and review only when needed — the results will speak for themselves.
Summary Table: Emotional Discipline in SIPs
| Investor Type | Avg. Return (5-10 Yr CAGR) | Avg. Risk (Volatility) | Avg. Investor Behaviour |
|---|---|---|---|
| Emotionally Disciplined | 11% – 13% | Medium | Continues SIPs through ups and downs |
| Emotionally Reactive | 7% – 9% | High | Pauses SIPs during crashes, rejoins late |
| Inconsistent Investor | 6% – 8% | High | Skips SIPs, lacks review/goal tracking |
Dr. Satish Vadapalli
Research Analyst
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