Mutual funds are complete investments in itself. I am saying this as you can get a lot of variety if you understand them well. Most of your investment needs can be fulfilled. But many people think you need big figures to invest. They are not aware of the minimum amount to invest in mutual funds in India. You can start as low as Rs 100 to Rs 1000. How and want to know best mutual funds to invest in minimum Rs 500… read on to know the details.

The mutual fund minimum investment starts from Rs 100 (Very selected funds in SIP only). But Rs 500 is the most sought-after figure. Call it rising inflation or blame the banking system. The minimum amount to invest in mutual funds in India is Rs 100 in SIP & Rs 1000 in a lump sum.

Have you wondered why your local kirana shop has small sachets of everything … like shampoo, jam, face cream, biryani masala & that Rs 2 Parle G packet.

To induce trial and obviously, you try with a small quantity.

Once you know you like, you can buy larger quantities. Similarly, mutual funds also have a gateway with small amounts. The best thing of mutual funds is that you can start investing with the minimum sum of amount and increase later on.

There is no other way to invest in reasonable diversification with the minimum amount of Rs 100 or Rs 500.

Suppose you start a SIP of Rs 500, every month you are buying small quantities of at least 30 companies. Yes, the portfolio of every scheme has 30-50 companies. So your Rs 500 contribution get divided and diversified in these so many companies.

Can you do that with RS 5000 or Rs 50000?

Minimum Amount to Invest in Mutual Funds in India

There is no restriction by regulator. The fund management decides the minimum amount. The idea is to manage cost with small amounts. So as discussed the minimum amount to invest lump sum is Rs 500 in most cases. Some mutual funds allow Rs 100 through SIP route.

Best Mutual Funds to invest in minimum Rs 1000, Rs 500 or Rs 100

First – We are responsible advisors and so let me say what is plain truth.

There is nothing called “Best Funds”. A fund which fulfills your goal in minimum risk can be called Best Fund for you.

Investments depend on your goal. They depend on your risk appetite. So portfolio should be made considering your goals & asset allocation. Whether you invest Rs 500 or Rs 5 Lakhs the risk remains same as underlying funds remain the same. So before thinking minimum, consider these factors also. Goals can be:

• You want tax saving from investments.
• Investment for short-term goals like car or maternity expenses
• Investment for long-term goals retirement or car replacement in 10 years.
• For just parking your ideal surplus

Minimum Amount to Invest in Mutual Funds in India – Category Tax Saving

The mutual fund investment is a great way to save tax under section 80C. It allows you to avail deduction of 1.5 Lakhs every year. Here are some funds where you can start at Rs 500. (Lump sum & SIP both)

Here are some good funds for tax saving

• DSP Tax Saver Fund
• ICICI Prudential Long Term Equity Fund
• Axis Long Term Equity Fund
• Aditya Birla Sunlife Tax Relief 96 Fund
  

Minimum Amount to Invest in Mutual Funds in India – Category Hybrid Funds

Hybrid funds are good to start investing in equities. There is one balanced fund as of today that allows you to invest Rs 500 in lump sum mode.

• Reliance Equity Hybrid Fund

These are some Balanced Funds which offers SIP in Rs 500.

• UTI Hybrid Equity Fund
• Tata Hybrid Fund
• SBI Equity Hybrid Fund
• DSP Equity & Bond Fund

Minimum Amount to Invest in Mutual Funds in India – Category Equity

For long-term goals, you need to beat inflation and the best way is to invest in equity funds.

There is only one fund with a minimum investment of Rs 500 in a lump sum.

• Quantum Equity FOF Fund

Some funds have Rs 2000 as a minimum LumpSum

• SBI Magnum MultiCap Fund

Many fund offer SIP in Rs 500 in diversified funds

• Franklin India Focused Equity Fund
• Kotak Standard Multicap Fund

Minimum Amount to Invest in Mutual Funds in India – Category Liquid / Short Term Funds

There are some funds who allow short-term funds with SIP for just Rs 500.

• Franklin India Short Term Plan
• Reliance Banking and PSU Fund
• HDFC Banking and PSU Debt Fund

Liquid or Ultra Short-term Funds

If your goal is to park your cash for short time, you can either consider a liquid fund or an ultra short-term fund.

• Axis Liquid Fund
• ICICI Prudential Ultra Short Term Fund
• Franklin India Low Duration Fund
• Tata Liquid Fund

Why investing is important, and not the minimum amount?

I understand that when someone has a small amount, he can invest in small only. For the same reason I am saying, funds are not important – To Start Investing is most important.

Sitting on fences, means you are a spectator. Participating means – You are a player.

If you win – you are a winner.

So, shed inhibitions. Keeping the minimum amount low is just one more good point to start investing.

So … plan and invest.

Hope you like the article on minimum amount to invest in mutual funds in India. Share it with your near ones to tell them you read some good things.