Mutual fund is a financial instrument that pools money from investors and uses it to invest it in various places like the stock market, bonds, government security, etc. Compared to a mutual fund, SIP (Systematic Investment Plan) is an instrument used to invest in mutual fund and is not an investment in itself. SIP allows investors to invest systematically i.e. quarterly, monthly or weekly. It also gives investors an opportunity to invest their money according to their preference which is hassle-free. Mutual fund has become very popular due to good returns and high-interest rates. I have been investing a lump sum amount in reliance mutual fund for a while via a direct plan which has earned me good profit. But I have used SIP when I had started my first job and needed to invest my income without putting in too much money. At that time it really turned out to be helpful and allowed me to invest easily as I had just started working. The advantage of using SIP for mutual fund investment was that I had to shell out a fixed amount every month, permitting me to plan my month accordingly. Also, with monthly SIP investment, the volatility of the stock market didn’t affect me so much.