Is Dollar-Cost Averaging a Trap? If You Have Idle Cash, Stop Blindly DCA-ing: Lump Sum Can Retire You 10 Years Earlier
More than 3 million people in Taiwan use DCA, but 9 out of 10 of them don't know what they're doing. U.S. research spanning 30 years confirms that lump-sum investing beats DCA 66% of the time, and the same NT$600,000 over 20 years ends up differing by NT$8 million. This article breaks down the 3 underlying rules, 4 iron thresholds, and a 4-step action plan, explaining why blindly DCA-ing your idle cash is the most expensive habit of your life. DCA is not a poison — it is just used in the wrong place. If you are a fresh graduate whose salary after rent and living expenses leaves only NT$5,000, of course you should DCA — you have no idle cash to lump-sum. But if you have been working 5–10 years and have NT$200,000, NT$500,000, or even NT$1 million saved, continuing to DCA is wasting your own money.