Inflation in India is slowly climbing — from daily groceries to electricity bills, your ₹100 now buys less than it did just a year ago.
💭 The burning question:
Can you beat inflation by investing in SIPs (Systematic Investment Plans) in 2025?
Let’s break it down.
What Is Inflation?
Inflation is the rate at which prices of goods and services increase over time. In 2025, India’s inflation is averaging around 5.5–6% per annum.
That means:
₹10,000 today = ₹9,400 in value next year if you don’t grow it.
Your savings must grow faster than inflation to retain purchasing power.
Why Fixed Deposits and Savings Fail to Beat Inflation
| Instrument | Average Return (2025) | Inflation Adjusted Return |
|---|---|---|
| Savings A/c | 2.5–3% | ❌ Negative |
| FD (5-year) | 5.5–6.5% | ❌ Near Zero |
| PPF | 7.1% | ✅ Slightly Beats |
| SIP (Mutual Funds) | 10–15% | ✅ Clearly Beats |
Fixed deposits are safe, but they barely match inflation — leaving your wealth stagnant.
How SIPs Help You Beat Inflation
What Is a SIP?
A Systematic Investment Plan lets you invest a fixed amount monthly in mutual funds — ideally in equity-oriented schemes.
Why SIPs Work Against Inflation:
Power of Compounding: ₹5,000/month for 15 years at 12% = ₹25.3 lakhs
Rupee Cost Averaging: You buy more units when the market is low
Equity Exposure: Stocks historically deliver 10–15% p.a., well above inflation
Real Example: Inflation vs SIP (₹5,000/month for 10 years)
| Scenario | Return | Final Value | Real Value (post 6% inflation) |
|---|---|---|---|
| FD | 6% | ₹8.2L | ₹5.0L |
| SIP | 12% | ₹11.6L | ₹8.0L |
🔍 Verdict: SIPs offer real growth; traditional options just preserve capital.
Which SIPs Should You Choose in 2025?
| Risk Level | Suggested Funds | Expected Returns |
|---|---|---|
| Low | Hybrid Funds | 7–9% |
| Medium | Large-Cap Funds | 10–12% |
| High | Mid & Small Cap Funds | 12–15% |
| Thematic | Sectoral (Infra, Tech, Green) | 14–18% (High Risk) |
💡 Use Vizzve to compare past returns, expense ratios & fund ratings.
SIP Tips to Outpace Inflation
Start Early – Time > Amount
Increase SIP yearly (Step-Up SIP) to match income growth
Stay Consistent, even in market dips
Rebalance Annually – shift to lower-risk funds near goals
Use Direct Plans to save on expense ratio
Monthly SIP Calculator Snapshot
| SIP Amount | Tenure | Return | Future Value |
|---|---|---|---|
| ₹5,000 | 15 yrs | 12% | ₹25.3L |
| ₹10,000 | 20 yrs | 12% | ₹76.5L |
| ₹15,000 | 25 yrs | 12% | ₹2 Cr+ |
🔧 Try Vizzve’s SIP calculator and goal planner today!
FAQs
1. Is SIP risk-free?
No, SIPs in equity mutual funds carry market risk. But long-term investing reduces volatility impact.
2. What’s the minimum SIP amount?
You can start with just ₹100/month in many mutual funds.
3. How long should I invest in SIP?
Minimum 5–10 years for inflation-beating, wealth-building results.
4. Are SIP returns taxed?
Yes. Capital gains above ₹1L/year attract 10% LTCG tax after 1 year.
Conclusion: SIPs > Inflation (If You Stay Invested)
SIPs are one of the best ways to beat inflation and build real wealth over time in India.
💭 Don’t let rising prices erode your dreams —
Start a SIP, stay consistent, and stay ahead.
With Vizzve, You Can:
Compare top-rated SIPs
Track fund performance & inflation-adjusted returns
Get alerts and SIP top-up reminders
Invest smarter with less effort
Your ₹5000 SIP Today = ₹1 Crore Tomorrow
Don’t wait. Beat inflation before it beats you.
Published on : 26th July
Published by : SMITA
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