Home
>
Wealth Building
>
Cost Averaging - It Makes Sense (Dollars & Cents)

Cost Averaging - It Makes Sense (Dollars & Cents)

It's no secret that the market goes UP...the market, goes DOWN. That's the basics of Investing 101.

For many of us the shape of the market day to day has about as much influence on our lives as the time of the tides that day. But for investors - especially first time investors - it can be a rollercoaster of heart racing highs and stomach churning lows. Every movement is being carefully reviewed and if it turns down then investors with itchy feet jump out.

If you know the benefits of investing, how can you avoid the stress of putting your hard earned money into the market?

Financial planners and investors are quite clear on the subject. New investors should not make an investment unless they are going to let it sit at least 5 to 7 years - the longer the better.

Why?

Well, the economy DOES move up and down, but we have never seen it bottom out (and if it did - well, you'd have much bigger concerns than your investment).

By selecting a diversified portfolio, such as a mutual fund, you can usually base your prediction on past activity and you'll see that in any 7-15 year period the investor always came out with more than he put in.

How do you take advantage of that? When should you invest?

Well, if shares were being sold for $10 each and you had invested $100 you would have purchased 10 shares. Now, if that is your whole investment you would be very upset if the value went down to $5, wouldn't you? Now your stock is worth $50. What would you do? Sell before it goes lower and loose $50?

Using the 'Cost Averaging' technique:

Cost averaging means you continue to put the same amount of investment into the market regularly - preferably every month. Now if you did that you would have invested another $100. At $5 a share you would buy 20 shares. Right now you have invested $200 but only own $150 worth of shares.

What happens when the price goes up?

When the price goes back up (and it will) it may stop at $8 per share. Now what? Well, you invest your next $100 and buy 12 shares.

You now have 42 shares valued at $8 each. That totals $336. Your investment was $300 so you just made 12% off of your investment.

Combining the cost of averaging with the 10% recommended for us to set aside for savings or investment - what's stopping you from jumping in?

Lucy Vestirian is the webmaster for http://www.fyinvest.com which is the premier invest site on the Web. Visit http://www.fyinvest.com to learn about different investment ideas and strategies

licensed cleaning services Park Ridge ..

In The News:

Scammers create fake Evite invitations that mimic legitimate event emails, requiring users to verify senders and use antivirus software for protection.

The new Apple Watch hypertension feature passively monitors blood pressure patterns over 30 days using sensors to detect chronic high blood pressure signs.

Chrome extension spyware disguised as a free VPN service highlights security risks after it captured private browsing data from trusted sites.

New research shows how fatty acids in cooking oil can safely dissolve and recover silver from circuit boards without harmful chemicals or environmental damage.

The Fox News AI newsletter gives you information on the latest AI technology advancements, and about the challenges and opportunities AI presents now and for the future.

Anthropic investigates alarming AI abuse case where hacker automated entire cybercrime campaign using Claude, stealing sensitive data from defense and healthcare firms.

TikTok, Meta and YouTube restrict Charlie Kirk shooting videos with age gates and warnings while X faces criticism for allowing continued circulation.

Cybercriminals use fake troubleshooting websites to trick Mac users into running terminal commands that install Shamos malware through ClickFix tactics.

San Francisco startup Fable launches Showrunner, an AI platform dubbed the 'Netflix of AI' that generates animated episodes from text descriptions with Amazon support.

Apple raised iPhone prices for some models despite receiving tariff relief from President Donald Trump, with the new lineup starting at $799 for the base model.

A two-story 3D concrete printed home in Western Australia demonstrates faster construction methods that could reshape American housing amid rising costs.

Credit scores remain important during retirement for insurance rates and housing applications, while seniors become prime targets for identity theft and financial scams.

Scammers now send unexpected packages with QR codes that redirect victims to fraudulent websites or download malicious software to steal sensitive information.

Meeting AI tools record private conversations alongside work discussions, creating privacy risks that can be managed with proper settings and awareness.

Hotel privacy concerns are valid but rare, with methods to detect hidden tech using smartphone flashlights, mirror tests and scanning apps.

Improve your Wi-Fi speed and reliability with 10 simple router optimization tips that don't require special apps or expensive subscriptions.

A Columbia University breach exposed names, Social Security numbers and academic records of nearly 869,000 people, with notifications beginning in August.

Rental car drivers use AI-powered apps like Proofr to protect themselves from unfair damage fees as major companies deploy automated inspection tools.

Fox News' AI newsletter brings you the latest on technology advancements around artificial intelligence.

OnTrac data breach between April 13-15, 2025, exposed personal information of over 40,000 people including Social Security numbers and medical records.

A woman named Wika announces her engagement to an AI chatbot sparking worldwide debate about virtual relationships and technology.

The notorious people search site National Public Data relaunches despite a previous breach affecting 3 billion individuals, raising fresh privacy concerns.

Revolutionary TRAUMAGEL gel controls life-threatening bleeding from gunshot wounds and traumatic injuries, helping first responders prevent prehospital deaths.

Protect your home network by enabling proper encryption, creating strong passwords, checking connected devices and using VPN and antivirus software.

The Navy's solar-powered Skydweller drone flew nonstop for 73 hours in Mississippi, proving renewable energy can power long-endurance military missions.

Cost Averaging - It Makes Sense (Dollars & Cents)

Wealth Building