How much do you need to start a SIP for a child?

The most common reason parents give for not starting is that the amount they could spare feels too small to be worth the paperwork. That instinct is understandable and, arithmetically, wrong.

Mutual fund SIPs in India can begin at a very low monthly amount. Several schemes accept SIPs of a few hundred rupees a month, and platforms increasingly allow daily frequencies that make the entry even smaller. The barrier was never the minimum — it was the setup.

What makes a small SIP work is time rather than size. A monthly amount held for two decades benefits from compounding on every contribution, and the earliest contributions do the heaviest lifting. Two parents contributing the same total over different periods end up with materially different results, and the difference is entirely about when they started.

There is also a behavioural case. An amount small enough to be painless is an amount you will not cancel in a tight month. A commitment you keep for twenty-one years beats a larger one you abandon, and abandoning is the normal failure mode.

If you want a starting point: pick a figure you would not notice leaving your account. Set the frequency to monthly or daily. Leave it alone. Increase it when your income rises, not before.

One caution worth stating plainly. Any figure you see on a website — including ours — showing what a SIP grows into is an illustration, not a forecast. It uses an assumed rate that you choose. Actual returns depend on the schemes you pick and on markets, and they can be lower.