Systematic Investment Plan (SIP) is a popular investment option which allows investors to invest a fixed amount at regular intervals in mutual funds. But sometimes, in case of fund not doing well or meeting a Financial obligation or in case of market crash one may decide to stop SIP or cancel SIP
It is easy to Cancel SIP in few steps. But stop SIP is not advisable till the time you attain your financial goal since SIP helps you to build wealth.
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Follow these simple steps to close SIP online (Systematic Investment Plan)
Table of Contents
How to Stop/Cancel SIP Online
- Visit respective AMC mutual fund company website
- Go to the login page.
- Find and click the option such as login/ transact online /investor /investor service / man icon etc. ( Different AMC have different formats).
- Choose investor option
- If have login credentials than fill username and password or else click on forgot password/ username
- Otherwise click on register now
- Follow the prompts and make a login/user id by entering your Folio details/PAN number
- Choose to make a transaction from the left/right menu.
- Choose stop SIP to stop SIP
- Or choose pause SIP to pause a SIP
- For any kind of support you can call 1800222999 or 1800 200 6666
- Or else email enquiry@iciciamc.com
Steps to stop SIP offline
- Download stop SIP form from AMC website
- Fill & Sign the form
- Give details such as folio number, bank account details, name of your SIP scheme, and SIP amount.
- Submit the form to the nearest AMC office or Registrar and transfer agents (CAMS or KARVY office).
- It takes approximately 21 days -45 days to stop your SIP.
- If you had given SIP instructions along with post dated cheques for SIP payment , then these cheques will be sent back to the investor.
Does SIP have lock in period?
Although most of the mutual funds ( except ELSS funds and close ended funds) do not any lock in period.
But, the sale of mutual fund units prior to the required holding time may result in capital gains taxes, which would lower your overall returns.
Transaction fees ( exit load) may also apply if you often buy and sell mutual fund units.
Read more about how mutual fund units are taxed
How to Stop SIP in CAMS?
- Type Stop SIP in CAMS in browser
- Go to MYCAMS
- Enter Your PAN number
- Select your mobile/email address
- generate & Submit OTP
- Choose transaction as SIP ( menu SIP /STP /SWP)
- Choose SIP name
- Submit cancel request
What if I cancel my SIP before maturity?
Nothing will happen, but you will lose an opportunity to save more. There is no penalty for stopping a SIP before maturity.
It is like stop making monthly contributions to your better wealthy future. That’s the effect of stop SIP.
SIP Cancel/Cancellation Charges
There is NO SIP Cancellation Charges. Therefore, one can cancel SIP anytime. No money/penalty is deducted for canceling SIP. This facility is free of cost for you.
By SIP Cancel/ Cancellation, you are instructing to stop future auto debit of money. It is basically cancellation of your standing instruction to the bank and AMC to stop further deduction.
There are No penalty, No charges are involved if you cancel SIP before maturity but if you redeem money charges may be involved based on fund type, holding period and other factors.
Can I cancel my SIP online?
Yes, definitely you can cancel / stop SIP online. The procedure to stop SIP online is explained above.
Can SIP be stopped anytime?
Yes, you can stop SIP anytime. There is. no compulsion to continue the SIP.
Why investors stop SIPs?
However, investors may stop their SIPs for various reasons, some of which are:
Change in Financial Goals:
One of the main reasons investors discontinue their SIPs, is a change in financial goals. For instance, the investor may decide to withdraw their SIPs if their objective shifts from long-term wealth accumulation to immediate financial need.
Example: The investor was accumulating for his Retirement but suddenly decide to buy a house property.
Life events:
Life events such as marriage, childbirth, or home purchase can change an investor’s priorities and result in the stop or pause SIP.
Lack of Trust:
The investor may stop their SIPs if they no longer have faith in the mutual fund provider or the fund management.
Bad Performance:
The investor may stop their SIP if the mutual fund’s poor performance over time or not performing as per their expectation.
Market Volatility:
Few investors tend to get nervous and stop their SIPs during market volatility. which is never suggested. Since it is market nature to go up and down.
Financial Constraints:
Sometimes the investor choose to exit mutual funds SIP due to sudden job loss or uncertainty or to meet some financial obligation etc.
Is it good to cancel SIP?
Although it is not advisable to discontinue SIP until and unless your financial goal is met. But in certain conditions like poor fund performance from quite some time or some other reasons one has to stop their SIP. One should avoid SIP Cancellation until it is damn necessary.
Can I withdraw SIP before 3 years?
Yes, you can withdraw SIP money before 3 years ( exception ELSS mutual fund and Close ended fund). But withdrawing money may cause you some charges.
SIP Taxation-How SIPs Are Taxed
Can I cancel SIP Anytime?
Yes, you can close SIP anytime. But it takes 21 days to 1 month time to stop SIP.
Will I get my money back if I cancel SIP?
No, you won’t get your money back if you cancel the SIP. Cancel SIP means just stopping the future payments.
In order to get/ redeem your money, you have to submit redemption request with the AMC.
NOTE: In order to cancel SIP and redeem money you need to make two requests: one is stopping SIP and another is redeem money.
Cancel SIP Means
Cancel SIP means that your monthly, quarterly or yearly MF investment will not be deducted. But your existing money will grow with time.
How long does it take to cancel SIP?
SIP cancellation takes place within 21 working days but sometimes it may take longer in some cases.
Is it better to pause SIP or cancel SIP?
In case of financial constraint such as instability in job for some time or in case you want to divert money for 3 months, in such cases SIP Pause is better.
When you need to put off investing for a while, such as when you have a financial emergency or need to reallocate money for a short-term objective like buying a car or taking a vacation, pausing a SIP may be a suitable alternative.
When you pause a SIP, your investments are put on hold for a set amount of time before automatically restarting. With this choice, you can continue with existing investment strategy rather than having to start again.
On the other hand, if you wish to stop investing permanently or if you want to modify your investment approach, SIP cancelling can be a better choice.
Read More: LIC Or SIP Or Mutual Funds- Which Is Better?
Any investments that have been made up to the point of cancelling a SIP will stay in your account and your investments will stop permanently.
But it is advised that you check the terms and conditions of your investment plan and speak with a financial advisor before making a choice.
Mutual Fund SIP-Systematic Investment Plan II Step By Step Guide On How To Start A Mutual Fund SIP
Additional Resources
SIP Or Fixed Deposit – Which Is Better & WHY?
SIP Or LumpSum – Which Is More Profitable?
LIC Or SIP Or Mutual Funds- Which Is Better?
