I parked a lump sum from CPF in Endowus for investment, since I'm still paying the housing loan. I didn't do DCA.
I set aside about 4 years of funds left in CPF-OA for repayments to the bank, in case I lose my job.
4 years period sound overkill, but I rather be careful because after the lock-in (the "honeymoon") ends, who knows what rate/amount I'm going to pay when the time comes.
Shengshi Chiam, CFA, Personal Finance Lead at Endowus
Posted on 29 Jul 2020
Thank you for your interest in us! There are a few factors at play including
What is the lump sum amount you have in your CPF
What is recurring amount you can invest in your CPF
When I first started out, I spread out my "lump sum" into 3 smaller lumps, then I have been doing a $1k+ recurring investment on a monthly basis. Hope this helps!
06 Aug 2020
Thank You! I see. But what is the pro and cons of lump sum and DCA then in this context for CPF?
Shengshi Chiam, CFA
07 Aug 2020
To put it briefly, when you do lump sum, you have more money invested, so you should be able to grow you wealth more quickly. When you spread it out and dollar cost average, you have less money invested, but in the case that the market goes down over the period that you spread out your investment, you are buying cheap. In the end no one knows for sure where the market is heading, it is best to have a plan and stick to it imo.
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