Dollar Cost Averaging Versus Lump Sum Investing

I spoke to a number of boomers recently who were contemplating investing in bank or credit union Certificate of Deposits (CDs) because they were not comfortable with market volatility. They were asking about Dollar Cost Averaging versus Lump Sum Investing so I thought it was time to revisit the concept.Dollar Cost Averaging, or DCA, (let’s face it, in this business everything has to be alphabet soup) is a strategy where you systematically invest a fixed dollar amount at regular intervals I.e. monthly or quarterly. It works best as a long-term strategy since the idea is that by systematically investing you are buying more shares when the market is down and fewer shares when the market is up thereby reducing the average share price that you pay for the security.DCA isn’t designed to protect you from a loss in a declining market (although it can as we will discuss later) and it doesn’t guarantee a gain but it does eliminate the stress of deciding when to invest so you do away with “market timing”. It’s a disciplined strategy so make sure you have a longer term goal and the resources to maintain the strategy through the highs and lows.You may not realize it but if you are investing through a retirement IRA or 401k you are in effect using a DCA strategy since money is coming out of your check each pay period and automatically invested in your 401k or IRA.Often the question comes up, “which is better, DCA or Lump Sum investing?” The answer isn’t that simple. Lump Sum investing depends on the timing of the investment. If you enjoy following the market and consider yourself an experienced investor then you may feel confident timing the buying and selling of your investments and you might outperform a DCA strategy. As we know, the markets are not predictable and many investors fall prey to the “buy high and sell low” trap. As a result their losses may be more severe than the DCA investor who is buying smaller amounts when the market is at a high.Since a DCA investor is buying more shares of a security as the price declines there is some downside protection in a declining market. As the market rebounds the DCA investor will “break even” faster than their Lump Sum investor because the DCA investor owns more shares at a lower average price than the Lump Sum investor who invested before the market started declining.Which makes the most sense for you? Among other factors it depends on what you goal is and how long you have to invest. It also depends on your risk tolerance and comfort level with investing in the market. You can take advantage of any number of on-line risk assessment tools or talk to a financial advisor. Any advisor worth their salt will always use such a tool as part of their service.Keep in mind that it’s not an all of nothing proposition. DCA might make sense for part of your portfolio while investing with a lump sum may be suitable for another part of your portfolio. In either event the key is to stay invested and avoid jumping in and out of the market.

Using a Janitorial Service – Is It Worth the Cost?

When it comes to your business, there are many things that have to be done on weekly basis. These may range from doing payroll to answering phones call, typing up the notes from a meeting or meeting with potential customers or clients, but one thing it should not need to include is spending time cleaning bathrooms, re-stocking toiletries, dusting and the myriad of other janitorial related jobs that must get done. It is these custodial jobs that while completely necessary, they should not be something that takes away from you having time to promote your company to its fullest.For many business, especially those small to mid-size companies, it is easy to think that their money should be used for something other than a janitorial service, but the stark truth is that when you are your company’s custodial provider, then you are not really saving money. Think about it. For every hour that you spend emptying trash cans, sweeping, ordering cleaning and bathroom supplies, vacuuming and doing related cleaning jobs, you could working towards the growth of your company. So, in hiring a custodial service you will actually be making an investment in your company. Rather than stressing out to see that the office looks presentable for that potential client’s visit, you can focus on preparing your presentation.With a janitorial services provider to maintain that all paper products are on hand, as well as being there to keep everything clean and smelling fresh, you can leave work on time each day. No scurrying about trying to get things tidied up, just a peace of knowing that everything will look great.Of course, for some businesses, there hold out for hiring a maid service is the fear of lost/stolen company information or perhaps a potential liability suit. Should you be concerned that company secrets are at risk, or if you are worried about your liability, then it is merely a matter of talking to several companies and learning about their hiring process – do they run background checks, are they license and bonded, and do they carry insurance. Just by checking on these basic aspects, you can quickly rule out those services that may be a less than perfect fit. No, you can’t be 100% certain that your trade secrets will never be breeched, but you can at least know who you are dealing with.Hiring a janitorial service for your company is an easy way to use your time and money wisely. In fact, like many things in business, it is an investment – the investment of time. So don’t waste your resources. Talk to a janitorial services provider such as All Source and make a new type of investment in your company.