Is it better to invest a lump sum all at once or spread it out?

On average, investing a lump sum all at once tends to beat spreading it out, simply because markets rise more often than they fall, so the sooner your money is in, the more time it has to grow. Historically, putting it all in immediately has outperformed gradual investing in the majority of periods. That said, dollar-cost averaging – splitting the money over several months – has a real behavioral advantage: it cushions the regret of investing right before a drop and makes it easier to actually follow through if a big lump sum feels paralyzing. The worst choice is usually doing neither and leaving the money in cash for years out of fear. A sensible compromise: if a lump sum keeps you up at night, spread it over a few months, but commit to a schedule and stick to it. For money already sitting in cash earmarked to invest, sooner generally wins.