3350: Dollar Cost Averaging by Ramit Sethi of I Will Teach You To Be Rich on Smart and Steady Investing
Optimal Finance Daily - Financial Independence and Money Advice
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Episode 3350:
Ramit Sethi breaks down dollar-cost averaging as a smart way to invest consistently over time without trying to time the market. He explains how this strategy can protect against volatility, while also comparing it to lump-sum investing, which often yields higher returns, but not without emotional trade-offs. Sethi also provides a practical guide for building an index fund portfolio from scratch, even on a limited budget.
Read along with the original article(s) here: https://www.iwillteachyoutoberich.com/blog/dollar-cost-averaging/
Quotes to ponder:
"Investing isn’t a race, you don’t need a perfect asset allocation tomorrow."
“Your asset allocation determines how much money you invest in different areas.”
“Spend less than you make and invest the difference.”
Episode references:
VTSAX (Vanguard Total Stock Market Index Fund): https://investor.vanguard.com/investment-products/mutual-funds/profile/vtsax
Vanguard Target Retirement 2050 Fund (VFIFX): https://investor.vanguard.com/investment-products/mutual-funds/profile/vfifx
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