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What Happens If You Miss Your SIP Payment?

We've all been there – life gets busy, and amidst the busy daily tasks and responsibilities, we sometimes forget or miss out on crucial things. If you have missed a SIP (Systematic Investment Plan) payment, you might be feeling anxious or unsure about the consequences and what to do next. Don't worry! Missing a SIP installment should not stress you enough. Here, we'll guide you through the steps you can take after a missed payment and how to get your investment journey back on track. Let's dive in and set things right!

What If You Missed Your SIP Payment?

One of the common concerns for investors is that what if their account balance becomes low or they are not able to pay for their SIP due to any reason? Well, if you too have been in the same situation, you are not alone. Remember, missing a SIP payment is extremely common.

Insufficient balance in the bank account is one of the prime reasons that many investors forget to pay for their installments. However, missing a SIP installment is something you should not worry about. Your investments will continue in a case like such. Moreover, the fund house will also not charge a penalty for missing the payment. 

Impact on Investment If You Have Missed Your SIP Payment

A SIP is an investment that may seem to come with the only drawback of an insufficient corpus due to a missed installment. What many people do not know is that even if they have missed a SIP payment, they can put money into their bank account as their payment would easily be done as and when the next SIP date arrives. What’s best is that their investment won’t suffer due to a missed SIP installment. 

Missing one or two SIP payments will not have any adverse reaction to your corpus. However, there are a few things that you must keep in mind regarding your missing SIP payments. They are as follows:  

  • If as an investor you have missed 3 consecutive SIP payments, your SIP investment is terminated by the mutual fund house.
  • The bank may charge you a penalty at the time when the bank account is low and you miss out on a SIP payment. 
  • Failure to make timely installment payments can impact your credit score, leading to potential consequences for future loan requests and other financial dealings. This situation could have wider effects on the investor's ability to secure loans and engage in various monetary transactions in the future.

Also Read: How to Check ICICI Term Insurance Policy Status?

How to Pay Missed SIP Installment?

If you have missed paying your SIP installment, here is what you can do:

  • You can deposit the necessary amount in your bank account before the next due date for payment. This helps in getting back on track when it comes to paying installments for SIPs as well as preventing the potential impact on your investments.
  • If you have missed a SIP installment and think that you won’t be able to even continue with the payments in the future, then you should pause your SIP Installment for some time. 

How You Can Avoid Missing Your SIP Payments

If you do not want to end up missing your SIP payments, here is what you can do: 

  • Keep track of your bank balance account. In case, your bank balance becomes low and you find it insufficient as per your SIP payment, try increasing the balance before the SIP due date arrives by depositing some amount to the bank account. 
  • If you know for a fact that you will not be able to pay the SIP payment due to an unavoidable financial obligation, you can go ahead and stop your SIP. Once you feel that your financial crunch is over, you can simply restart the payment. During the same, your earlier SIPs will continue growing if you do not redeem them. 
  • Pausing your SIP investment is also one of the options you can go with. Especially, if you are expecting heavy expenses as well as liquidity issues. Remember, any mutual fund houses will grant you the freedom to pause your SIP installments for up to a certain number of installments. The mutual fund house can also allow you to pause SIP installments for up to a certain period after which they begin automatically. Keep in mind to check if the AMC provides the same option and pause your SIPs for a few months when you encounter a financial crunch.  
  • It is recommended to guarantee that your account maintains an ample balance and to establish automated payments using electronic debits. This approach helps prevent the risk of overlooking any installments and ensures a seamless payment process.

Final Words  

There is no need for you to be concerned if you have missed a few SIP installments due to unavoidable circumstances. But, make sure you understand that this would not mean that you can miss out on paying many SIP installments as it would end up massively affecting your corpus. 

It is highly advised to avoid missing the SIP installment of LIC, SBI etc. Furthermore, cover up for the loss by making additional purchases in the scheme if you cannot avoid not missing your SIP payment.

Also Read: 15 Best SIP Plans to Invest for Next 10 Years


Ques. What happens if I miss a SIP payment?

Ans. When you miss a SIP installment, the bank usually treats it as a failed transaction. This means you won't have to pay any penalty for the missed payment, but that specific month's investment won't be made.

Ques. Will the missed payment affect my credit score?

Ans. No, a missed SIP payment is different from missing a loan EMI or credit card payment. SIPs are about investing your money, not borrowing. So, a missed SIP doesn't get reported to credit bureaus and won't impact your credit score.

Ques. Can I make up for the missed installment?

Ans. Yes, you can compensate for the missed SIP by making a one-time lump sum investment in the same fund. Check with your fund house or investment platform on how to proceed with this.

Ques. What if I foresee missing future SIP dates?

Ans. If you think you'll miss upcoming SIP dates due to reasons like a change in salary date, consider rescheduling your SIP. Most fund houses allow you to change your SIP date once a year.

Ques. Can I automate the payment to avoid missing it in the future?

Ans. Absolutely! Setting up an auto-debit or standing instruction with your bank ensures the SIP amount is automatically transferred on the designated date, reducing the chances of missing payments.

Also Read:

All About Bharti AXA Premier Protect Plan

SIP Calculator for Investment in 2024

Disclaimer: This article is issued in the general public interest and is meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive and should research further or consult an expert in this regard.   

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