The short answer
If markets rise steadily, investing everything today wins: every month in cash is a month of growth missed. With $50,000 held for 10 years at 7%, investing at once gives about $100,483, versus $98,657 when spread over 12 months with cash earning 3%.
But if the market falls 20% three months in, the picture flips: spreading out ends around $93,662, while investing at once ends around $80,386. The later slices bought in after the fall, at lower prices.
Spreading out is insurance against bad timing. On average it costs some return; in a crash it saves you a lot.
How this calculator works
- The market grows each month at the annual return (after fees) divided by 12.
- All at once buys the full amount on day one.
- Spread out buys an equal slice at the start of each month. Money not yet invested earns your cash rate.
- Market drop applies a single fall in the month you pick, after which growth continues at the same rate.
Which should you choose?
- Long time horizon and calm nerves: investing at once has the better odds.
- Worried a fall right after investing would make you sell: spreading over 6–12 months can make it easier to stay invested — which matters more than either choice.
- High cash rates: the cost of waiting shrinks, so spreading out is cheaper.
Already investing from your salary each month? See what that grows to with the ETF Investment Calculator, or work back from a target with How Much to Invest Monthly.
Frequently asked questions
Is it better to invest a lump sum or spread it out?
On average, investing all at once has come out ahead more often, because markets have risen more often than they've fallen and money in the market has longer to grow. Spreading out wins when prices fall during your buying period. It trades some expected return for less regret if a crash comes right after you invest.
What is dollar-cost averaging?
Investing a fixed amount at regular intervals instead of all at once. When prices are low your money buys more units; when they're high it buys fewer. Monthly investing from your salary is dollar-cost averaging by default — this calculator is about the choice when you already have the full sum.
How often does lump sum investing win?
Research on historical markets, including a widely cited Vanguard study, found investing immediately beat spreading it over 12 months roughly two-thirds of the time. Past patterns are no guarantee, and the one-third of cases where it lost included painful crashes.
Why does cash interest matter?
Money waiting to be invested isn't idle if it sits in a savings account or money-market fund. The higher the cash rate, the smaller the cost of spreading out — and if cash pays more than the market returns, spreading out wins even without a drop.
Is this calculator a prediction?
No. It uses a constant return and, optionally, a single fall you choose. Real markets move every day. It's built to show the mechanics so you can decide what you're comfortable with.