Lump Sum vs DCA Calculator

About this calculator

Lump-sum investing means putting a full amount into the market immediately, while dollar-cost averaging (DCA) means spreading the same total across equal purchases made at regular intervals, such as monthly, over several months. Because markets tend to rise over long periods, investing the full amount immediately statistically outperforms DCA more often than not, since more money spends more time invested and compounding; DCA's advantage instead comes from reducing the risk and regret of investing everything right before a downturn.

Financial advisors and individual investors reach for this comparison after receiving a windfall — an inheritance, bonus, or sale proceeds — when deciding whether to deploy it all at once or ease in gradually, and academic studies (notably from Vanguard) are commonly cited showing lump sum wins on average roughly two-thirds of the time in US equity markets, though DCA can outperform during sustained downturns.

This calculator projects the final balance of investing a lump sum immediately against spreading the same amount across monthly purchases over your chosen time horizon, using your assumed rate of return, so you can compare the two strategies for your specific numbers.