Dca Vs Lump Sum
Calculator
Results
- Final balance
- $116,129.49
- Balance from a single lump sum
- $120,579.68
- Difference against a lump sum
- $-4,450.19
- Total contributed
- $60,000.00
Portfolio value over time
- Portfolio balance
- Money put in
Projection schedule
| 1 | 60,000.00 | 1,962.93 | 1,962.93 | 61,962.93 |
| 2 | 60,000.00 | 4,479.30 | 6,442.23 | 66,442.23 |
| 3 | 60,000.00 | 4,803.11 | 11,245.35 | 71,245.35 |
| 4 | 60,000.00 | 5,150.33 | 16,395.68 | 76,395.68 |
| 5 | 60,000.00 | 5,522.65 | 21,918.33 | 81,918.33 |
| 6 | 60,000.00 | 5,921.88 | 27,840.21 | 87,840.21 |
| 7 | 60,000.00 | 6,349.98 | 34,190.19 | 94,190.19 |
| 8 | 60,000.00 | 6,809.02 | 40,999.20 | 100,999.20 |
| 9 | 60,000.00 | 7,301.24 | 48,300.44 | 108,300.44 |
| 10 | 60,000.00 | 7,829.05 | 56,129.49 | 116,129.49 |
Comparison
| Scenario | Final balance | Total growth |
|---|---|---|
| Doing nothing | 120,579.68 | 60,579.68 |
| Your plan | 116,129.49 | 56,129.49 |
Formula
FV(DCA) = Σ (T/k)(1+i)^(n−j) vs FV(lump) = T(1+i)^n= 116129.49
Note
Returns are not guaranteed and this is not investment advice. This projection applies the displayed standard formula to the rates you entered and assumes they repeat, unchanged, every single period. Real markets do not behave that way: returns vary year to year, can be negative, and past or projected performance never guarantees future results. The model ignores taxes, trading costs, currency effects and any fee you did not enter. Treat the figures as an illustration of the arithmetic, not a forecast, and consult a licensed adviser before acting on any of them.
More in Portfolio growth
See all →Frequently asked questions
What is dollar-cost averaging (DCA) and how does it differ from investing a lump sum?+
DCA means splitting a fixed total amount into equal investments made at regular intervals over time, rather than investing it all at once. It smooths out the average purchase price across market ups and downs, while a lump sum is exposed fully to whatever the market does starting immediately.
Which one usually produces a higher expected return historically?+
Investing as a lump sum has historically outperformed DCA more often than not in rising markets, simply because more money is invested and exposed to growth for longer. DCA tends to look better specifically when a market decline happens shortly after you start investing.
So why would anyone choose DCA if lump sum usually wins on average?+
DCA reduces the risk of a single bad entry point and the regret of investing everything right before a downturn — it's a risk-management and psychological choice as much as a return-maximizing one, particularly useful when you're uncertain about market timing or investing a windfall you'd feel worse about losing quickly.
How does the comparison change with the length of the DCA period?+
A longer DCA period (spreading the investment over, say, 24 months instead of 6) reduces timing risk further but also delays market exposure longer, generally pulling the expected return further below what a lump sum would have achieved in a typical rising market.
Does this calculator assume a specific market path, or an average return?+
Most versions use a constant assumed growth rate for simplicity, which actually understates DCA's main advantage — smoothing out volatility — since a flat, non-volatile path doesn't reward averaging into dips. A volatile, choppy market history would show DCA's benefit more realistically than a smooth average return.