We often get to see that a Systematic Investment Plan (SIP) tends to outperform lump-sum investments over longer periods of time.

Before understanding what a SIP offers, it is essential to understand what the SIP does not offer. For example, the SIP is not an assurance of lower risk and higher returns.

The difference between most of them is based on the term to maturity or the credit quality. There is also a classification based on the discretion of the fund manager in terms of allocation.

What do we understand by top mutual funds in India? There are obviously two ways to look at it. The simpler way is to look at the AUM of the top funds at a point in time.

Liquid Funds are the best way of creating an emergency fund. Read about how liquid funds and debt funds are taxed to make sound investment decisions.

The basic rule of investing in mutual funds is that it conscious decision and not a random decision.

Split the savings between a mix of government-backed schemes, mutual funds & more. Know how much you can invest out of 30,000 & how much you can earn.

Broadly, there are four possible reasons why the SIP could be outperforming. Remember, 3 years is still a very short time to evaluate returns on equities.

After all, you are relying on the judgement and discretion of an individual fund manager and you really cannot be sure of whether they will do a good job or not.

Your pressures at your work place may be tight enough to leave you with little spare time to worry about how to create a second stream of income. That is when you have to make money work hard for you. Let us look at two such approaches.