See what investing the same amount every month could become.

What is dollar-cost averaging?

Dollar-cost averaging (DCA) means investing a fixed amount on a regular schedule — for example $500 every month — no matter what the market is doing. When prices are low your money buys more shares; when prices are high it buys fewer. Over time this smooths out your average purchase price and removes the pressure of trying to time the market. It's also simply how most people invest from a paycheck.

How this DCA calculator works

You enter an optional starting amount, your monthly contribution, an expected annual return, the number of years, and how often returns compound. The calculator grows your balance period by period and reports your projected future value, the total you contributed, your estimated investment gains, and the inflation-adjusted value. The chart breaks your ending balance into two parts: the money you put in versus the growth on top of it.

Contributions vs growth: the snowball effect

Early on, most of your balance is simply the money you've contributed. But as the years pass, compounding takes over and investment gains can grow larger than your contributions. The longer your time horizon, the more dramatic this effect becomes — which is why starting early and staying consistent matters more than picking the perfect moment.

Choosing a realistic expected return

The expected return you enter drives everything, so be thoughtful. Many investors model a diversified stock portfolio somewhere in the 6–8% range before inflation, but returns vary widely year to year and the future is never guaranteed. A smart habit is to run several scenarios — conservative, moderate, and optimistic — to see a realistic range of outcomes rather than trusting a single number.

Don't forget inflation

A $275,000 balance in 20 years will not buy what $275,000 buys today. The inflation-adjusted figure restates your projection in today's dollars so you can judge what your money will actually be worth. If your goal is a future purchase, the real value is the number that matters.

Is DCA better than investing a lump sum?

It depends. Historically, investing a lump sum immediately has often beaten spreading it out, simply because markets tend to rise over time. But DCA reduces the regret and risk of investing everything right before a downturn, and it fits how paychecks arrive. Compare the two directly with our lump sum vs DCA calculator, and check whether you're on pace for a specific target with the investment goal calculator.

Remember: this is a projection, not a promise

Every figure here is a hypothetical estimate based on your inputs. Real markets fall as well as rise, and no calculator can predict actual returns. Use the results to understand the mechanics of steady investing — not as a forecast of any specific outcome.