Dollar-cost averaging means putting a set amount into investments at regular intervals, buying more shares when prices are low and fewer when high. It removes the temptation to time the market and smooths out the effect of volatility. Most people already do this automatically through 401(k) contributions each paycheck.
Investing $500 on the first of every month is dollar-cost averaging.
Investing feels complicated until you understand the order of operations. This guide walks you through exactly what to do first, second, and third — without overwhelming jargon.
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