Dollar-Cost Averaging or Lump Sum? How to Invest a Larger Amount
The trade-off between investing all at once and spreading purchases over time.
4 min read · Savings & Investing
Life situations: Investing and Wealth Building
If you receive a bonus or inheritance, you must decide how to invest it.
Lump sum
Investing everything at once gives the money the most time in the market. Historically this has beaten gradual investing in most periods, because markets tend to rise.
- Final value
- Total contributions
Example with default values. Open the calculator →
Dollar-cost averaging
- You invest equal amounts at regular intervals.
- It reduces the risk of investing just before a fall.
- It suits regular savers who invest from income.
Which to choose
Taxes and costs
In Switzerland, gains on private investments are tax-free, so the choice rarely depends on tax. Spreading purchases can mean more trading fees, so check your broker's cost per order before you choose a monthly plan.
If a possible loss would worry you, spreading the purchases over six to twelve months is a reasonable compromise. See the effect with the monthly savings growth calculator.
Try it yourself: Monthly Savings Growth
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- Total contributions
- CHF 155'000
- Gains
- CHF 160'161
| Year | Balance |
|---|---|
| 5.00 | CHF 40'420 |
| 10.00 | CHF 85'876 |
| 15.00 | CHF 144'213 |
| 20.00 | CHF 219'080 |
| 25.00 | CHF 315'161 |
- Final value
- Total contributions