Dollar Cost Averaging vs. Lump Sum | Practical Advice

Making an investment is a big decision. You want to make sure you're doing what's best for you and your money. In this video, we'll compare dollar cost averaging vs lump sum investing and give you some practical advice on which might be the better option for you.

Timecodes:

0:00 - Intro
0:30 - What is dollar cost averaging
3:03 - What is lump sum investing
3:58 - What does the research say is better?
6:07 - Practical advice

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DISCLAIMER: I am not a financial adviser. These videos are for educational and entertainment purposes only. I am merely sharing my personal opinion. Please seek professional help when needed.

[EmadElSammad]

Great video. Exactly what I was thinking. Lump sum always win because it applies the “time in the market beats timing the market” principle.

[BriansWealthJourney]

Trying to time the market isn't my style. I don't have that many active brain cells left, Lol. Your spreadsheet really opened my eyes. I can't believe the spread was so low. You can DCA daily, weekly, bi-weekly, monthly, or even yearly. DCA protects us from our own emotions.

[catherinedesilets]

That made a lot of sense! Thanks for explaining

[iurevych]

Good video. Agree it depends whether the pile of cash is collected over a period of time or is available all at once at a particular moment such as after selling a house.

Simply sitting and collecting a pile of cash = timing the market. I just saw some folks liking lump sum method but end up wasting time rather than DCAing

[Kevangelo]

Thanks man. That was an easy topic to digest when you explained it with some studies.

[SG-xbde]

4:46 Invest lumpsum immediately, even when the market is at all time high like right now 11th Oct24?

[higiniomorales]

The key is to lump sum half and then DCA the rest monthly (12 month DCA plan), learned not to lump sum the entire sum in one shot last year when the S&P500 drop 20% just months after i maxed outy Roth and put ot all in into VTSAX.

[optick]

Most importantly everyone: just invest. Dont wait for dips, pick one of these strategies and just do it.

[demoticshadow]

Whats a term for constantly setting money aside and watching for opportunities/ downturns?

[KPad]

My 401k is DCA and my Roth IRA is lump sum yearly .

[johngill]

If you're worried about losses and market downturns you're better off diversifying with non-stock investments like bonds or cash. What exactly do you do if you're done dollar cost averaging? Do you resell your holdings in dollar cost average again? You're eventually going to have a lump sum in the market and the way to protect against downside risk is to diversify

[johngill]

When you invest in a 401k your periodically investing not dollar cost averaging. People often confuse dollar cost averaging with periodically investing

[dabocousin]

I loved the video but why do you talk like you are about to laugh

[Juliakfit]

안녕하세요. 방금 이메일 보내드렸어요. What a great video! I subscribed to your channel. I'm very new to investing. I would appreciate your advice and thoughts on my questions. Could you answer my questions sent by email?
If you have large sum of money NOW with the current market situation, would lump sum still be a good option? Or how would you split with DCA+Lump sum if you have 200k for example??