How should I top up SIP when salary increases?
Erode powerlooms understand leftover yarn. Leftover salary is the same. If the raise disappears into food delivery, the SIP stayed in 2024.
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A raise is two envelopes
The CTC PDF said +₹8,700. By December the SIP was still ₹7,000 and the coffee app had a new badge.
Split the increment: ~₹4,350 extra SIP, rest to life. In 12 months that extra is ₹52,200 of new principal. In 15 years at 12% that stream alone is a serious subplot.
That is the actual question. Not the slogan on the brochure.
In Erode this debate still shows up at dinners as if character, not cash flow, is the variable.
Numbers first. Feelings after the numbers get a chair.
A 10% auto step-up on a ₹7,000 SIP is only ₹700. Nice. A raise-based top-up of ₹4,350 is how 1-crore maps close without pain in year one.
If those two numbers already make you uncomfortable, believe them.
Nobody hands out a medal for pretending your Excel is braver than your salary.
50% of increment is a boring, lethal rule
On increment day, open the AMC app before you open the furniture app.
Use the step-up calculator to preview 10% annual vs a one-time jump. Many people need both: a jump now, 10% later.
Open a calculator and type the ugly version first—₹8,700 × 12 = ₹1.04 lakh/year of new cash. If SIP sees ₹0 of it, you took a raise and bought inflation for the food apps..
Pretty assumptions belong in investor-day decks, not in your rent money.
If variable pay is 40% of CTC, top up only on fixed. Bonus can be a one-time buy.
Top-up in the same fund. Opening a new “raise SIP” every appraisal is a zoo.
If you cannot explain the result to a slightly impatient parent, you do not understand it yet.
Top-ups that wait for “a round figure”
Waiting till SIP is a round ₹10,000. Markets do not grade roundness.
Topping up a small-cap because “this is aggressive money.” Extra salary is still goal money.
Top-up plus a new EMI in the same fortnight. You cloned your old leftover.
A rule of thumb is a starting fence, not a closing argument.
Your cousin’s 2017 small-cap luck is not a policy.
When the salary or the date moves, reopen the calculator. Do not recycle last year’s PDF.
Miss two annual check-ins in Erode and you will still blame rates. Rates were the smaller leak.
Do it the week the CTC letter lands
Fixed hike, no new EMI: send 40–50% of the increment to SIP the same week.
Hike but FOIR already 40%: maybe 20% to SIP, rest to prepay the nasty loan.
No hike this year: 10% step if possible, else freeze. Shame is not a product.
Order of operations still applies: high-cost debt, then a cash buffer, then this debate.
Investing while revolving a 36% card is theatre.
If cash is tight this quarter, shrink the plan. Do not vanish from it.
A smaller SIP or a shorter loan goal beats a heroic screenshot you cancel in six weeks.
₹8,700 hike, ₹4,350 to SIP
₹7,000 → ₹11,350 after a ₹4,350 top-up. That is a strategy. ₹7,700 after 10% is a rounding.
₹4,350 extra for 15 years @12% is a pile your future self will not call leftover chai.
Three years of unused hikes is a silent ₹1.2 lakh+/year leak at today’s salary, growing.
Treat every rupee here as a sketch. Lenders and markets get a vote later.
If the plan only works at 18% returns or a 6% home loan forever, it is not a plan.
Stress it at a worse rate. If it still stands, you can live with the nicer years too.
Keep a 10% haircut for tax, fees, or the extra month the builder delays.
Lifestyle can have the other half. It may not have both
Top-up is a calendar event, not a personality.
If the raise cannot be seen in the mandate, it went to someone else’s P&L.
Quiet deposits look dull until they are the only thing that showed up.
Calendar reminder beats a quote about discipline.
When someone in Erode asks, share the widget with your numbers stripped. Let them type theirs.
And please date your spreadsheet. Future you will not remember which fantasy version this was.
Use this to think. Use a human with a licence before you transfer.
Quick answers
What percent of a salary hike should go to SIP?
40–50% of the increment is a sturdy default if EMIs are sane. Variable pay can wait for a lumpsum/STP.
Is a 10% annual step-up enough?
It helps a lot on a long horizon. A raise-week jump plus 10% later is how odd salaries catch 1-crore maps.
Should I start a new fund with every hike?
No. Top up the goal’s fund. New funds are how people lose the plot.
Change the numbers in the calculator above and see the result on this page.
Estimates only—not personalised financial, tax, or investment advice. Markets, loan rates, and tax rules change. Confirm numbers with your lender, CA, or advisor before acting.