sumit
1
I am currently investing in HDFC Tax saver fund for last 14 months and amount Rs.1000 per month.I want to know on completion of three years how the repayment will be made (lumsump or monthly) and if I discontinue the tax saver SIP now ,how amount already paid by me will be repaid to me or I have to pay for 36 months compulsorily.
Thanks
In case of SIP, units are bought every month and each of these set of units have their own lock-in of 3 years.
So Lets say you bought 10 units in Jan 2010 for 1000 Rs, 11 units in Feb 2010 and 9 units in March 2010, then 10 units are sell-able after Jan 2013, more 11 after Feb 2013 and more 9 after March 2013. At the end of March 2013, you can redeem all these 30 units, but after Jan only 10 and 21 after Feb.
Mutual funds are not like bonds or fixed deposits, even after lock-in is over, your money will stay invested, unless you yourself apply for redemption. You may redeem partly or all units.
If you discontinue SIP, no further investment will be made, but all existing investment will stay as it is and you can redeem them after 3 years completion from date of buying.
You can stop SIP anytime and there is no commitment needed to pay for 3 years. You can even run SIP for as low as 6 months. Or you can even do one time investment as lump-sum.
