Automatic Investment Plan - AIP

AAA

DEFINITION of 'Automatic Investment Plan - AIP'

An investment program that allows investors to contribute small amounts of money, such as $20 a month in regular intervals. Funds are automatically deducted from the investor's checking/savings account or paycheck and invested in a retirement account or mutual fund.

INVESTOPEDIA EXPLAINS 'Automatic Investment Plan - AIP'

This is one of the best ways to save money. By "paying themselves first" many people find they invest more in the long run. Their investments are treated as another part of their regular budget. It also forces a person to pay for investments automatically, which prevents them from being able to spend all of their disposable income.

RELATED TERMS
  1. Systematic Investment Plan - SIP

    This is a plan where investors make regular, equal payments into ...
  2. Compounding

    The ability of an asset to generate earnings, which are then ...
  3. Mutual Fund

    An investment vehicle that is made up of a pool of funds collected ...
  4. Direct Stock Purchase Plan - DSPP

    An investment service that allows individuals to purchase a stock ...
  5. Dividend Reinvestment Plan - DRIP

    A plan offered by a corporation that allows investors to reinvest ...
  6. Dollar-Cost Averaging - DCA

    The technique of buying a fixed dollar amount of a particular ...
Related Articles
  1. Voluntary 401(k) Contributions: A Thing ...
    Retirement

    Voluntary 401(k) Contributions: A Thing ...

  2. Mutual Fund Basics Tutorial
    Mutual Funds & ETFs

    Mutual Fund Basics Tutorial

  3. Will ETFs Eventually Replace Mutual ...
    Mutual Funds & ETFs

    Will ETFs Eventually Replace Mutual ...

  4. Understanding The Bond Behemoth That ...
    Mutual Funds & ETFs

    Understanding The Bond Behemoth That ...

comments powered by Disqus
Hot Definitions
  1. Certificate Of Deposit - CD

    A savings certificate entitling the bearer to receive interest. A CD bears a maturity date, a specified fixed interest rate ...
  2. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  3. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  4. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
  5. Days Payable Outstanding - DPO

    A company's average payable period. Calculated as: ending accounts payable / (cost of sales/number of days).
  6. Net Sales

    The amount of sales generated by a company after the deduction of returns, allowances for damaged or missing goods and any ...
Trading Center