To lump sum or not to lump sum. That is the question!

[Tsumitate Wrestler]

Just to add to this debate:

If you are not keeping money on the sidelines (Outside of your emergency/house maintenance fund etc), and you invest X amount every paycheck, you are not DCAing. You are "periodic lump sum investing"

Paycheck investing is lump sum investing. You are investing as soon as you have the fund, in one go.

DCAing is more when you have a sum that you are prepared to invest, and you do so strategically in tranches.

...

Also - Vanguard on the issue-

A https://investor.vanguard.com/investor- ... -is-better

B - https://investor.vanguard.com/investor- ... s-lump-sum

[RTanakard]

I filled out my tsumitate this year but didn't add anything to the lump sum. I was thinking about adding a lump sum now, and then another at the start of the new year. What do you think?

[ChapInTokyo]

Just to add to this debate:

If you are not keeping money on the sidelines (Outside of your emergency/house maintenance fund etc), and you invest X amount every paycheck, you are not DCAing. You are "periodic lump sum investing"

Paycheck investing is lump sum investing. You are investing as soon as you have the fund, in one go.

DCAing is more when you have a sum that you are prepared to invest, and you do so strategically in tranches.

...

Also - Vanguard on the issue-

A https://investor.vanguard.com/investor- ... -is-better

B - https://investor.vanguard.com/investor- ... s-lump-sum

Wow, this chart in the first of your Vanguard links makes an interesting point!



So depending on market conditions, cash outperforms investing in equities about 1/3 of the time, regardless of whether its cost averaging or lump sum investing... now that's sobering!