DCA (Dollar-Cost Averaging) Calculator
Simulate a dollar-cost averaging investment strategy — periodic contributions at a chosen frequency compounding over time — and compare the result against investing the same total amount as a single lump sum.
Input
Historical S&P 500 average is about 7-10% annually.
Optional starting balance before periodic investments begin.
Output
| Metric | Value |
|---|---|
| No data yet | |
| Year | Total Invested | DCA Value | Lump Sum Equivalent | DCA Gain |
|---|---|---|---|---|
| No data yet | ||||
Guides
What is dollar-cost averaging?
Dollar-cost averaging (DCA) is an investing strategy where you invest a fixed amount at regular intervals — weekly, monthly, quarterly — regardless of the asset's price at the time. Instead of trying to time the market with one large purchase, you spread purchases out, which averages your entry price over time and removes the emotional pressure of picking the "right" moment to invest.
How this tool works
- Enter your periodic investment amount and how often you invest (weekly through yearly).
- Set the investment duration in years and your expected annual return.
- Optionally add an initial lump sum already invested before the recurring contributions start.
The tool simulates your portfolio period by period: each period, your contribution is added to the balance, then the balance grows by that period's share of the annual return. The Summary shows your final DCA value, total invested, total gain, and — for comparison — what the same total money would have grown to if it had all been invested as a single lump sum on day one. The Year-by-Year Comparison table breaks this down annually.
DCA vs. lump sum
Investing everything as a lump sum on day one typically outperforms DCA in a rising market, simply because more money is exposed to growth for longer. DCA's real benefit isn't higher expected returns — it's reduced timing risk and a disciplined, automatic way to invest money as you earn it, rather than waiting to accumulate a lump sum first.
Common uses
- Modeling a 401(k), IRA, or brokerage account funded with regular paycheck contributions
- Comparing a "invest as you go" strategy against saving up for a lump-sum investment
- Estimating how a recurring monthly or weekly investment habit compounds over decades
- Understanding how contribution frequency affects long-term growth
Privacy
This tool runs entirely in your browser. Your numbers are never uploaded to a server.