Should I invest $1000 at once or $100 for 10 months? - Seedly
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Asked on 30 May 2020

Should I invest $1000 at once or $100 for 10 months?

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Boon Peng
Boon Peng
Level 6. Master
Answered on 30 May 2020

It depends whether you need the $1000 anytime soon.

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Hi anon,

To be honest, $1000 will not have a significant impact early on. While you can invest it, transactional costs may eat your returns. You may want to instead hold on to it and build your capital, and more importantly build up your knowledge about the various asset classes, so that you can make a wiser decision down the road, instead of investing just because you want to.

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TC
TS Chua
Level 3. Wonderkid
Answered on 04 Jun 2020

10 months is a bit too long. For cost dollar averaging effect, can accumulate 3 or 6 months then invest. If not the admin fee will cost you a lot of money in long term.

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Kathy
Level 2. Rookie
Answered on 06 Jun 2020

There's no right or wrong answer. Certain stocks are currently trading at discounts. But some are saying there might be a major dip in the markets in the near future. Do your own research and due diligence. As long as you've a long term outlook, it really doesn't matter.

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Zi Shuen
Zi Shuen
Level 6. Master
Answered on 04 Jun 2020

DCA into RSP or robo-advisor at $200 a month for 5 months should be alright.

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You need to know your investment objective and risk appetite. Thereafter, we need to know the type of assets that you are investing into. Above all, there is no right or wrong answer. Instead, it is more about what you are comfortable with that matters. Here is a comparison between the two methods: Lump Sum vs Dollar Cost Averaging

I share quality content on estate planning and financial planning here.

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Adriel Thin
Adriel Thin
Level 5. Genius
Answered on 04 Jun 2020

If $100/mth is a regular-savings plan, then it's possibly okay, otherwise the brokerage fees will be too high. Even if it's $1000 as a lump-sum investment, brokerage fees might still be too high. Brokerage fees would be a primary concern to me for your scenario.

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Carol Neo
Carol Neo
Level 4. Prodigy
Answered on 04 Jun 2020

Both have benefits you should compare before doing that.

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Frankie Rappaport
Frankie Rappaport
Top Contributor

Top Contributor (Aug)

Level 9. God of Wisdom
Updated on 31 May 2020

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Heng Kai Le
Heng Kai Le, Mondomover at School Of Life
Level 6. Master
Answered on 31 May 2020

Dr Wealth gives a thorough explanation of when it's better to use lump sum investing and when it's better to use DCA. Check this out: https://www.youtube.com/watch?v=m5Ez7j_TGRw

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Wilson Nid A Break
Wilson Nid A Break
Level 9. God of Wisdom
Answered on 30 May 2020

Larger fixed sum per transaction = lower % transaction cost

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