US Dollar Cost Averaging Calculator

Investment Information
$
Yrs
Mos
Total: 60 months
%

About Dollar Cost Averaging

Reduces Emotional Investing: Automates purchases regardless of market conditions.

Lowers Average Cost: You buy more shares when prices are low and fewer when high.

Simplifies Investing: Set up automatic investments and forget about timing the market.

Flexible: Can be used with any investment amount and frequency.

Risk Management: Spreads investment risk over time rather than lump-sum investing.

Taxable Accounts: Each purchase has its own cost basis for capital gains calculation.

Tax-Loss Harvesting: DCA creates opportunities to offset gains with losses.

Retirement Accounts: 401(k) and IRA accounts grow tax-deferred or tax-free.

Dividends: Reinvested dividends create new tax lots in taxable accounts.

Wash Sale Rule: Be mindful when selling at a loss and repurchasing similar securities.

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Historical US Market Returns
Asset Class 10-Year CAGR Volatility
S&P 500 10.7% 15.6%
NASDAQ 14.2% 20.3%
US Bonds 4.1% 4.7%
Real Estate 8.9% 12.8%
Gold 5.3% 16.2%
Returns as of July 4, 2025. Past performance is not indicative of future results.
DCA Examples ($)

For 30 years at 7%:

  • Invested: $36,000
  • Portfolio Value: $113,000
  • Returns: $77,000

For 20 years at 8%:

  • Invested: $347,000
  • Portfolio Value: $1.12M
  • Returns: $773,000

For 15 years at 10%:

  • Invested: $190,000
  • Portfolio Value: $447,000
  • Returns: $257,000
DCA Investment Strategies
  • 1. Automate investments with broker recurring purchases
  • 2. Focus on low-cost index funds or ETFs
  • 3. Increase amounts with salary raises
  • 4. Combine with dividend reinvestment (DRIP)
  • 5. Stay consistent through market cycles