How A Freedom SIP Can Set You Free From Financial Worries

As human beings, we are all born free. However, as time passes, we all feel constrained, unable to live our lives as we choose. This is why, as individuals, we are always seeking freedom—freedom to follow our passion, freedom to travel the world anytime, freedom to decide when to retire, and freedom to live the life we have always imagined. But as they say, there is no such thing as a free lunch. Everything, including our freedom, has a cost.

Different people need freedom for different purposes. No matter what stage of life you are at, your desire for freedom does not abate.

• Young college pass-out: If you are a young college pass-out then you primarily have two paths that lie ahead of you—you either dream of pursuing a non-conventional career or you opt for corporate life as it gives financial stability. While in the former case, you have the fear of not having cash flows and being financially dependent on your parents, in the case of the latter, you might have a stable cash flow but you are still left with a feeling of emptiness.
• Working professional: As a young working professional, you inarguably have a few liabilities and responsibilities which could include EMIs, utility bills, children’s school fees, etc. Thus, the financial stability of a steady job is very important to you. Hence, the dream of becoming an entrepreneur remains unfulfilled.
• Working professional with grown-up children: At this stage, your aim is to ensure that children are financially secure, both today and in the future. Thus, legacy planning becomes important. At the same time, you are also at the juncture where you need to ensure that you have enough funds saved for your retirement. It is possible that to secure the financial future of your next generation, you are compromising on your aspirations.
• Nearing retirement: At some point, all of you would have dreamt about your retirement and thought of everything that you’ll do during your golden years. However, if not planned well, many may end up working even during their retirement years due to a shortfall in their retirement kitty.

Freedom to live your life, your way

The question then is, what do you need to become free? The answer lies in being disciplined with investments and starting on the journey early on. Helping you in this journey is ICICI Prudential which offers a feature called Freedom SIP.

Freedom SIP is a feature that helps create secondary cash flows. The process is very simple. You start your journey to freedom with a monthly SIP in a scheme of your choice. The SIP enables you to consistently invest your money and accumulate wealth over time. Once the SIP timeframe is over, the entire amount is moved to a different scheme which has a lower risk profile. At this stage, the aim is to protect the capital created. It is from this account that the Systematic Withdrawal Plan (SWP) will be initiated.

Benefits of Freedom SIP

• A goal-based investing solution: When you drive down a road without knowing where you are going, you run the risk of getting lost and losing time. That is why having a goal or a destination is very important. Once you have a goal, you can tag your investments to it and start your investing journey accordingly.
• Freedom to choose tenures: There are some goals that must be met in the short term, medium term, and long term. Freedom SIP allows you to choose from a wide range of tenures, ensuring that you can tag multiple goals to your investments.
• Inculcates the habit of long-term investing: It is all too easy to get swayed by market sentiment and make sub-optimal investment decisions in response to the market’s ebbs and flows. However, SIP can help you avoid many behavioural traps while reaping the benefits of long-term investing.

Freedom to choose from a wide range of schemes based on your needs and risk appetite: Every individual is different, with varied risk profiles, return requirements, and investment time frames. Freedom SIP allows you to choose from a diverse range of schemes spanning risk profiles and tenures, ensuring that your investments can meet your unique needs.

To conclude, while money can’t buy happiness, it may set you free. Thus, it is imperative that you plan your investments optimally by choosing the investment options that are best suited to your requirements and embark on your path to financial freedom.

Sanjeev Mishra, S S Fund Distributor Pvt Ltd.

Disclaimer

The views are personal and are not part of the Outlook Money editorial Feature.