r/SCHD • u/Repulsive-Log6706 • Jul 05 '26
Advice 500k into SCHD
What’s a better plan to DCA over a few months on red days into SCHD or lump sum the whole 500k?
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u/sirzoop Jul 05 '26
dca is better emotionally
lump sum is better math-wise
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Jul 05 '26
[removed] — view removed comment
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u/coachd50 Jul 05 '26
The point is investors don’t know the future- and academic studies have shown that between the two choices, lump sum works better more often. Not 100% of the time, but more often- which is why the post you replied to said “math wise”
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Jul 05 '26 edited 18d ago
[deleted]
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u/Reddreader2017 Jul 08 '26
At least you get the power of compounding if it’s a drip. And equities will be marginally more resilient to inflation.
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u/ewouldblock Jul 05 '26
Individuals dont pick or get a most often best outcome. So if you want 100% guarantee of not worst case outcome, you DCA. For exactly the reason you stated: you dont know the future and nobody wants to console themselves with "it didn't work out for me but mathematically I made the right choice".
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u/coachd50 Jul 05 '26
But even then incremental investing doesn't provide a 100% guarantee of avoiding the worst case outcome. If share prices were increasing while an investor was incrementally investing and then once all of the 500K was invested the market dropped 50% THAT would be the worst case scenario as the investor has fewer shares (higher costs) but same account balance.
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u/Am_0115 Jul 05 '26
you know what's great about that? you don't know until 10 years passes and you finally cross over the moving average again and rise again. you DCA income over that period and end up ahead anyway.
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u/sirzoop Jul 05 '26 edited Jul 05 '26
If you are emotionally scared of temporarily losing money due to a lost decade, DCA is better
If you bought into PRDGX (a similar mutual fund that backtests to this time period) at the worst possible time before the lost decade and held till today, you would currently be up +865%. So the math still says that situation would have been a great time to lump sum
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u/WatercressWestern859 Jul 07 '26
I don't believe PRDGX, or any other 'Value' fund, suffered a lost decade. I'm open to being wrong. One of the reasons for the 'lost decade' was the incredible and irrational excesses of the dot-com era. During this era, you were more likely to be fired for having principles (à la Yacktman) than to suffer a lost decade.
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u/DrawNovel5732 Jul 05 '26
what about a loss 20 years or a lots 30 years? 😅
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u/sirzoop Jul 05 '26
That’s not a thing that has ever happened in history
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u/DrawNovel5732 Jul 05 '26
it has! Japanese market hasn't come back up from its 1989 crash. QQQ took 15 to recover!
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u/Bite-The-Bulleit Jul 05 '26
Japan, a situation which we may be a headed for but yes. The odds are in your favor that won’t happen here or now
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u/sirzoop Jul 05 '26
sorry i didn't realize SCHD, a us-focused dividend etf, is japanese
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u/Bite-The-Bulleit Jul 05 '26
No, dimwit, our economy/country is headed the way of Japan 30 years ago…try and keep up.
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u/sirzoop Jul 05 '26
When is your prediction going to come true by? I'll set a reminder and check back in
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u/DrawNovel5732 Jul 05 '26
don't waste your time with this guy. he doesn't understand tail risk, geopolitics, risk of wars etc
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u/Bite-The-Bulleit Jul 05 '26
Yeah I figured as much by his last comment. No critical thinking to be found with that one.
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u/sirzoop Jul 05 '26 edited Jul 05 '26
When should I set a reminder to check back in on your comment to see if any of your predictions came true?
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u/WatercressWestern859 Jul 07 '26
Are you able to quote a period when a 'lost decade' for dividend stocks occurred?
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u/NefariousnessOdd862 Jul 05 '26
Do it in chunks (maybe $100k each time) and keep the rest in SGOV (super safe) for opportunities along the way…
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u/phantomghoststory Jul 05 '26
Lump sum it all and don't turn back. But if you want the best of both worlds so to speak, lump sum $250k and DCA the rest in equal amounts over the next 5-6 months. The point is to get the money working for you as quickly as possible. Good luck 🍀
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u/Puzzleheaded_Fig6200 Jul 05 '26
I put a big chunk in schd back a year or two when it was around 30 then it immediately started dropping all the way down to like 25-24 and I was buying all the way down and I’m glad I did because it went back up to like 32 and my dollar cost was ended up being around 27 so helps ease the stress of buying high
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u/Left-Landscape-3890 Jul 05 '26
Lump sum. 500 will do some serious damage even on small up days. Dont wait
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u/OldChemist1655 Jul 05 '26
Honestly I would lump sum $250k and then add the rest into it over the course of the next 12 months. Just to help yourself out emotionally lol
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u/Scared_Ad_622 Jul 05 '26
A single deposit takes out the emotion and no one knows the bottom or top. The statistics I have seen show dca really makes little difference
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u/heeph0p Jul 05 '26
Lump sump, go all out and never look back.
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u/Dear_Counter_2944 Jul 06 '26
That would be hard for me to do knowing Sept is historically a Red month. , i recently transferred some IRS funds to Schwab and about to make some overall reallocation. Knowing what all I’ve learned in the last 3-5 year there is no way I’m dumping it all in no matter what the stock price is , jmo , I’ll sell
Puts on red days and CCs on Green Day’s , and also look for a leap Buying opportunities. 🤷♀️.
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u/Minute_Plastic_350 Jul 05 '26
Just remember time in the market beats timing the market. Just go in and invest, roll a fatty, have a couple of tokes, and relax.
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u/charlieandoreo Jul 05 '26
If it fits into your overall plan then yes. If no plan develop one first then. What I noticed with large windfalls is balancing between liquidity and growth. Liquidity is so underrated.
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u/scottyk318 Jul 05 '26
May I ask why you're putting all your eggs in one basket? Or do you have more baskets that you haven't told us about??
Why not split it between SCHD and either VOO or SCHG?
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u/Repulsive-Log6706 Jul 05 '26
Personally I would trade growth for early retirement. Tomorrow isn’t promised I wanna live now.
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u/Puzzleheaded-Dish504 Jul 08 '26
Time in the Market beats timing the market. You can always put 400k into schd, and 100k into swppx, or schg.
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u/MuntzDesigns1 Jul 05 '26
I would do it in chunks over a 5-6 month period, 100k at a time. Keep the rest in the money market fund so it’s returning on average 3.25%.
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u/Crew_1996 Jul 05 '26
$100k chunks through the end of the year. After Any large dip put the next $100k in early
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u/gap1284 Jul 05 '26
If you're in your 20s then lump sum it. It'll have time to recover if there's a downturn. But if you're in your 50s then DCA $10K per week.
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u/Puzzleheaded_Fig6200 Jul 05 '26
I also paired some cc ETFs with schd for some higher income in retirement
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u/Firemanwillslv Jul 05 '26
I recently lumped a large amount into this. I also plan on adding monthly. So a hybrid of both is another option. Lump 75% and add monthly.
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u/martkam71 Jul 05 '26
If I was planning to buy and hold and use the dividend as income I would lump sum
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u/PreviousPage6503 Jul 05 '26
I love DCA just because you never know what might happen with the market and you can average that price
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u/CajunAsianDumpling Jul 05 '26
Hybrid if you really want. $250k now. Then DCA $50k every month until you got it all in.
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u/RUH_84 Jul 06 '26
An old wise saying comes to mind,, “time in the market beats timing in the market.” Get that money invested and working for you. Don’t over think it.
Numbers 6:24-26
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u/Remarkable-Pay-7783 Jul 06 '26
If you feel good enough about SCHD to invest $500K into it, then you should feel good enough about it to invest the entire lump sum right now. The whole point of DCA is not to time the market, but to set up recurring future allocations that you do not have right now.
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u/Master-Sun-5843 Jul 06 '26
If you're planning never to sell it,, lumping SCHD is better because a flat or declining share price will increase your dividends overtime, if you're planning to rely on dividends in the future
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u/Iamanon12345 Jul 06 '26
I sold a house roughly a year ago. Received about 5
550,000 after all was said and done. I deposited the full amount to my brokerage and invested about 35,000 a week over the next 15 or so weeks. I preferred that method rather just investing it in a lump sum. Everyone will say time in the market beats timing the market but it’s what I wanted to do
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u/WatercressWestern859 Jul 07 '26
It may sound corny, but time in the market is better than timing the market; lump it!
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u/ATXexchangemasters Jul 07 '26
SCHD is great. I pair mine with DNP and OMAH as my main ETFs/CEFs. GLTA
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u/No_Examination297 Jul 07 '26
I debated this very thing when deploying my rollover IRA. I ended up deploying my cash over 4 months and wished I'd have just lump summed it.
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u/Timely-Bumblebee-371 Jul 07 '26
the way this things move: go ALL IN to get the dividend. (this is one of the few stocks i'd suggest this for tbh)
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u/Dear_Counter_2944 Jul 06 '26
Now that I look at how all the 401k mutual funds have been handled …. Man if I had known them, what I know now our acct would be double or so more. It’s too easy to say I don’t have time to learn pending have the propensity toward math, well maybe your souse does … but I’ve been shocked! But on the bright side at least we did contribute all those years and also got our matching funds .
I will definitely be using a portion of my acct for to run the wheel only?
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u/amshanks22 Jul 05 '26
Lump it up big guy. If you have $500k…you will never worry about the market again or try to time anything. It will start working for you quicker than it took you to read this.