Join Early Retirement Today
Thread Tools Search this Thread Display Modes
How do you invest in IRA - Dollar Cost Averaging or Lump Sum?
Old 03-28-2009, 01:25 PM   #1
Recycles dryer sheets
Join Date: Mar 2009
Posts: 357
How do you invest in IRA - Dollar Cost Averaging or Lump Sum?

I usually do lump sum a couple weeks or so before the contribution deadline. However, I'm wondering what people on here tend to do and if DCA is a better/safer approach.
bank5 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 03-28-2009, 01:30 PM   #2
ziggy29's Avatar
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,433
I get paid twice a month. On each payday I transfer $416.66 from checking into a Roth, alternating between my wife's and mine so that each gets $416.66 per month, and then I invest accordingly.
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
ziggy29 is online now   Reply With Quote
Old 03-28-2009, 01:32 PM   #3
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Jun 2005
Posts: 10,210
Lump sum into the cash sweep, then decide how to work the money into our asset allocation.
LOL! is offline   Reply With Quote
Old 03-28-2009, 02:48 PM   #4
Thinks s/he gets paid by the post
charlie's Avatar
Join Date: Mar 2004
Location: Dallas
Posts: 1,211
Those who lumped in last year got lumped! That includes me and
the inheritance I received in early September after the market had
already fallen quite a bit. I in my infinite wisdom decided that we
were at or near a bottom and the danger was remote. Then came
the "bottom" in November followed by the "real" bottom in early
March. Do you see a pattern here? The benefit of DCA is to avoid
investing at a market top. Studies over the years have shown that,
statistically, lumping in has a marginally higher return, but my advise
is don't be greedy......particularly if you are talking about a large sum
like an IRA roll-over.

You may miss some of the turnup we are presently enjoying but who
knows what's coming down the road?


charlie is offline   Reply With Quote
Old 03-28-2009, 03:17 PM   #5
Thinks s/he gets paid by the post
Join Date: Jan 2006
Posts: 3,877
I lump sum at the beginning of every year. I don't think there's a significant advantage either way. I do a lump sum at the beginning of the year because I don't have a large cash reserve and putting the max in all at once at the beginning of the year forces me to get my cash savings back up quickly. It's just a personal choice. It also eliminates the possibility of spending the money on something else and not maxing the IRA.
aaronc879 is online now   Reply With Quote

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
Dollar cost averaging is... a lie? Sisyphus Young Dreamers 43 07-09-2007 04:15 PM
Lump sum to invest, DCA in or go lump? Olav23 FIRE and Money 4 03-03-2007 04:22 PM
How to invest a lump sum ScaredtoQuit FIRE and Money 47 02-05-2007 05:33 PM
Lump Sum or Dollar Cost Averaging your Roth/IRA mickeyd FIRE and Money 3 11-23-2006 04:38 PM

» Quick Links

All times are GMT -6. The time now is 09:57 PM.
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2020, vBulletin Solutions, Inc.