“Uncle, my portfolio is bleeding red!” Bunny shouted, staring at his phone.
It was March-2020. The market was crashing faster than a scooter on a pothole-filled Delhi road.
Like millions of Indian investors, Bunny’s fear was simple: “If I keep my SIP running, my money will disappear. Better to stop, right?”
Sound familiar? That sinking feeling when your investment drops is real. Watching your savings and investments shrink feels like spilling hot tea on your lap - sudden, painful, and messy.
But here’s the truth…
Stopping SIPs during a market fall is like refusing to buy mangoes just because they’re on sale - you’re missing the sweet deal!
Meet Our Characters
Hero = Bunny: A typical investor, emotional and confused.
Guide = Investing Uncle (me): Calm, wise, SIP-ping tea, delivering truths with humour.
The Problem - Bunny is in Extreme Panic and Emotional Pain
“Uncle,” Bunny shouted, “the market has crashed. My SIP is losing money. I am stopping my SIP before they eats my Money?”
His face was redder than his portfolio.
I was Listening and Smiling
I sipped my tea and smiled.
“Bunny, stopping SIP during a stock market fall is like saying ‘Doctor, I feel weak, so I’ll stop eating food.’ Does that solve the problem?”
Bunny frowned. “But Uncle, the news and social media says the market will fall even more!”
“Of course,” I chuckled, “the media’s job is to scare you. If you depend on headlines, you’ll never invest.”
Uncle’s Simple Explanation
“Look, Bunny,” I explained, “here’s why investors stop SIPs when markets fall:”
Fear of loss: Seeing red on the portfolio hurts.
Loss aversion: Losing Rs.1 lakh feels more painful than the joy of gaining Rs.1 lakh.
Short-term mindset: They forget SIPs are for 10-15-20 years and not 10-15-20 days.
Misunderstanding SIPs: They think SIP means guaranteed monthly profit. No - it means disciplined monthly investing.
Media noise: Headlines scream “MARKET CRASH!” and people panic.
First crash experience: New investors have never seen a real fall before.
But the truth is this:
SIPs work best during market crashes because you buy units cheap.
Stopping SIPs = missing a discount sale.
Indian markets (Sensex, Nifty) have always recovered from every crash.
SIP ensures rupee cost averaging - buying at different prices lowers your risk.
Compounding + Discipline = Wealth creation.
Benefits Shown - What Happens If You Continue, Bunny
“Think of SIP like exercise,” I said. “You don’t quit the gym just because abs aren’t showing after three months. Similarly, don’t quit SIP because markets fall for a year.”
If you continue SIP during a market fall:
You buy more units at lower NAV.
When the market recovers, those cheap units multiply your returns.
Your average purchase cost comes down.
Your goals - retirement, education, home - stay on track.
You develop financial discipline.
Bunny’s Transformation and He Understands…
Bunny’s eyes widened.
“So Uncle, I shouldn’t stop my SIP?”
“Never!” I replied. “If you have extra money, you should even top up. Market crash is like a discount sale.”
He laughed. “Like Big Billion Day sale?”
“Exactly,” I said. “Except this sale doesn’t give you gadgets - it gives you future freedom.”
Actionable Tips for Investors
Maintain an emergency fund (6 months of expenses) in FD or liquid funds, so you’re not forced to touch your SIP during panic.
Remember, SIP is for long-term goals, not short-term needs.
Review your funds, not your fear.
Don’t try to time the market - discipline beats timing.
If possible, increase your SIP during market crashes.
Wisdom Connection
“Bunny, remember our lesson for freelancers…
Income is Irregular, Expenses Are Not.
…The market’s income is irregular too, but your goals and expenses are permanent. SIP is the bridge.”
Bunny smiled. “So market has mood swings, but my goals don’t.”
Our Reader is the Real Hero
Bunny walked away calmer, smarter, and still investing.
And you, My Dear Reader, you should feel and do the same.
If Bunny can fight fear and continue Investing, so you can.
“Stopping SIP in a stock market crash is like throwing away your umbrella during heavy rains – you may get a fever tomorrow.”
If this blog gave you clarity, maybe you owe Investing Uncle one cup of tea. Because telling the truth about money may sting a little, but wisdom with tea always tastes better.
So, what will you do during the next market crash - stop your SIP or collect discounted units?
Drop your thoughts in the comments, subscribe for more tea-time money wisdom, and let’s meet again next Sunday at 09:15 AM.
Disclaimer: Mutual fund investments are subject to market risks, read all scheme related documents carefully before investing. The past performance of the mutual funds is not necessarily indicative of future performance of the schemes. Investors are requested to review the prospectus carefully and obtain expert professional advice with regard to specific legal, tax and financial implications of the investment/participation. This blog/Website is for Educational purpose only. Any reference should not be treated as any form of Financial Advice.
Any person referred to in this post is purely coincidental. The characters, names, and situations mentioned are for illustrative and educational purposes only and are not intended to represent any real individual.
‘Investing Uncle’ is NISM Series V-A Certified (Mutual Fund Distributor’s Certification Examination) conducted by National Institute of Securities Markets (NISM).
Investing Uncle is not SEBI/AMFI Registered.