Episode 081:

The Problem with Reverse Dollar Cost Averaging

Dollar Cost Averaging is a very popular strategy when you are saving money for retirement. When you retire and begin taking money out of retirement accounts, Reverse Dollar Cost Averaging presents a problem and it’s important to understand this problem. In this episode, I’ll explain Reverse Dollar Cost Averaging and teach you what to do about it.

Included in this episode:

  • The stock market went nowhere during the 2000-2009 decade (January 1, 2000, to December 31, 2009)
    • This has lead to that 10-year period being known as “The Lost Decade” for stock market investors
  • USA Today article from Adam Shell “Indeed, a $1 investment in the S&P 500 on Dec. 31, 1999, was worth roughly 90 cents at the end of 2009 – and that negative return includes dividend income”
  • What about retirees though?
    • What if you were invested in the market AND trying to take an income from your accounts at the same time like countless retirees, really the majority of retired people do?
    • This is when RDCA will show up in a big, negative way and crush your retirement dreams
  • The DCA Review..

Important links:


Charlie, your host:

CharlieMedium“Charlie Jewett is an Author, Speaker, Podcast Host, Consumer Advocate, and Investment Advisor from San Diego, Ca.  Charlie has spent the last eleven years trying to change the way the industry professionals and consumers think about Retirement.  Charlie provides education materials that help people to create their own financial plans and offers services to protect consumers from the bad guys in the Financial Services Industry.”  


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