Skipping 1 SIP a Year? Here’s How Much Wealth You Lose

Systematic Investment Plans (SIPs) are one of the most disciplined ways to build long-term wealth. By investing a fixed amount regularly, investors benefit from rupee cost averaging and the power of compounding. However, many investors underestimate the effect of skipping even a single SIP installment in a year. While it might seem negligible at first, over the long run, it can create a significant dent in your wealth creation journey.

The Impact of Skipping SIPs

When you skip a SIP, you’re not only missing out on that month’s contribution but also the compounded returns it could have generated over time. Since compounding works best with time in the market, even small gaps can reduce your final corpus.

Example: Impact of Skipping 1 SIP Every Year

Let’s assume:

• SIP Amount = ₹10,000/month
• Investment Tenure = 20 years (240 months)
• Expected Annual Return = 12% (~0.95% monthly return)

Scenario 1: No Skips

If you invest ₹10,000 every month for 20 years, your final corpus will be about: 
₹99.91 lakh.

Scenario 2: Skipping 1 SIP per Year

If you miss 1 SIP every year (20 skipped SIPs in total), your final corpus falls to around ₹84.78 lakh.

The difference between staying disciplined with SIPs and skipping just one instalment every year is far more significant than it seems. Over 20 years, a regular SIP of ₹10,000 per month at 12% annual returns can grow to about ₹1 crore, while skipping just one SIP per year reduces the corpus to around ₹85 lakh. That’s a shortfall of nearly ₹15 lakh, wealth that could have been built simply by staying consistent.

This gap arises because each skipped SIP not only reduces the immediate contribution but also erodes the compounding benefits that accumulate over the years. It highlights how crucial discipline is in long-term investing and why investors should avoid breaks in their SIP journey.

Note: The above calculations are based on assumed returns and regular contributions for illustration purposes. Actual results may vary.

Also Read: SIP for Down Payment vs Full Property Purchase – Which Goal Works Better?

Conclusion

SIPs work best when you remain disciplined and consistent. Skipping just one SIP a year may look harmless, but over time, it can cost you lakhs in lost returns. To stay on track, plan your investments wisely, and use tools like a SIP Calculator to visualise your goals. Remember, in the world of compounding, every instalment matters.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.