Dollar cost averaging time frame.
I have a net worth of about $7.5 million.
I’m selling a home I own that will net me about $1.8 million in cash.
I’d like to dollar cost average invest into my approaching retirement portfolio mix of mutual funds. I’m 65. But over what time frame and percentage should I do this? A year and 8% a month? Thank you.
Terry Says
Whoa, you need a lot more financial planning advice than just a “formula” for when and how to invest in the stock market!
Have you done an estate plan, created a Revocable Living Trust? Dealt with the possible issue of estate taxes?
Have you though about who will get the balance of your estate if you can’t spend it all?
Have you looked at your overall risk tolerance? Your current diversification of assets?
Have you looked at your current annual cost of investing, in terms of fees, commissions, and hidden costs?
Have you made a lifestyle plan and a spending plan to ensure that even this large sum of money lasts as long as you do?
I suggest this is the time to meet with one or two financial planners — out of a universe you can trust: Fee-only, FIDUCAIRY, financial planners. You can find them at Wealthramp.com, where only these advisors who fully disclose all fees and pledge to put your interests first are carefully vetted, then matched to your goals and preferences.
Please give it a try. There is a link in the top corner of my website or you can go there directly. Interview at least two of them, and it doesn’t have to be in-person. But these are smart people whom you can trust. And once you’ve done a comprehensive financial plan, you’ll realize how much more there is to this decision. (And read THe Savage Truth on Money — 3rd edition on Amazon!)