Dollar‑cost averaging vs lump sum: which is better?

Lump sum invests earlier (more time in the market). Dollar-cost averaging spreads timing risk. Use the calculator to model both.

Lump sum (pros/cons)

Pros: more time invested. Cons: if you invest right before a downturn, it can feel painful short-term.

Pros: reduces timing risk and can help behaviour. Cons: cash stays uninvested longer.

Lump sum: enter the full amount as your initial investment and set monthly contribution to $0.
DCA: set initial investment to $0 and enter a monthly contribution that matches your planned schedule.

Is lump sum always better?

Often it wins mathematically because money is invested sooner, but timing risk and behaviour matter.

Is DCA safer?

It can feel safer because you spread entry points over time, but it can reduce returns if markets rise.

What if I’m anxious about investing a lump sum?

A reasonable compromise is a short DCA period (e.g. 3–6 months), then commit to the plan.

Can I model a hybrid plan?

Yes. Use a smaller lump sum plus monthly contributions.

Does the calculator predict markets?

No. It uses an average return assumption for education and scenario testing.