I'm 31, started taking this stuff seriously around 28. For the past three years I've been maxing my Roth IRA every January, like I transfer the full amount in the first week of the year. I read somewhere that lump sum on January 1st beats dollar cost averaging statistically and I just ran with it. Here's where I got nervous. I was talking to a coworker last week who's been in this space longer than me and mentioned my January strategy and she asked "wait, do you invest it when you transfer it or do you just let it sit?" And I had this moment of like. Oh.
Went home, logged in, checked my contribution from January this year. It had been sitting in the settlement fund for four months. Just cash. Earning basically nothing. I did the same thing last year too, transferred in January and didn't actually buy anything until like March when I happened to log in for something else.
I went back through my records and I've done this all three years to some degree. Transferred the money, felt good about it, and then just kind of forgot to actually put it into anything. I did the rough math on what I probably lost in growth by having it sit in cash for weeks or months at a time and it's not catastrophic but it's not nothing either. Couple thousand in missed growth probably, maybe more.
I've since bought into my target date fund and set up automatic investments going forward. But I'm wondering if anyone else has done this and whether there's anything I should be thinking about now to make up for it, or if it's just a lesson learned and move on.
also genuinely cannot believe I didn't catch this sooner. Three years.