The Magic of Step-Up SIP: How a 10% Hike Doubles Wealth

The "Set and Forget" Mistake

Most investors start an SIP of ₹5,000 in 2015. It is now 2026. They are earning double the salary. But their SIP is still ₹5,000.

This is the "Lazy Tax". By not increasing your investments as your income grows, you are leaving crores on the table.

Chapter 1: The One-Click Magic (The Math)

Let's compare two investors, Raj and Simran. Both start with ₹10,000/month.

• •Raj: Continues ₹10,000 for 25 years.
• •Simran: Increases SIP by 10% every year (Step-Up).

Simran retires rich. Raj retires okay. Just a 10% annual increase (which is less than your typical salary hike) tripled the final outcome.

Chapter 2: Why Step-Up Works?

1. •Lifestyle Inflation Defense: When you get a hike, your expenses rise instantly (Better car, better vacay). Step-Up forces your savings to rise before your expenses do.
2. •Back-Ended Compounding: The extra money you put in later years (e.g., year 15) is substantial. 10% hike on ₹50,000 is ₹5,000 extra per month. It adds heft to the snowball.

Chapter 3: How to automate it?

You don't need willpower.

1. •Zerodha/Groww: When starting an SIP, check the box "Automatic Step-Up" or "Top-Up".
2. •Set Cap: You can set a cap (e.g., "Step up until SIP reaches ₹50,000").
3. •Manual Date: If you get appraisal in April, set a calendar reminder for May 1st: "Modify SIP".

Chapter 4: The 50% Bonus Rule

If you don't like fixed percentages, use the Bonus Rule.

• •Every time you get a Bonus or Incentive: Invest 50% instantly.
• •Spend the other 50% guilt-free.
• •This captures "Windfall Gains" into your wealth bucket.

Conclusion

Your income isn't flat. Your expenses aren't flat. Why should your investment be flat? "If you are not stepping up, you are stepping back."