Dollar Cost Averaging is often used by investors because they are worried that their investments will go down in value.
Wrong reason.
I have stated before that the reason to put a set amount of money into investments on a regular basis (paycheck deduction, for example) is because you simply do not have a lump-sum to invest. If you have a lump-sum, then diversify it appropriately but immediately - not in stages.
Markets, overall, rise over time (15 year or longer time horizons). They have up to this point and that includes the Great Depression, world wars and double-digit inflation periods.
So...
as long as you have a time horizon measured in many years, then do not dollar-cost average (DCA). This DCA technique is simply an easy way to regularly invest if you don't have the cash.
Oh, by the way, if you stopped contributing anytime during the past 2 years, then you truly are defeating the purpose of dollar-cost averaging anyway.
An Introduction
Hi. Welcome to BourGroup and my blog. Phil
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.