What to do with extra money – buy more stocks?

When the stock market started to dip after a long period of highs, I asked my husband if we wanted to buy more stocks with our “extra” money (extra service contracts, money saved from housekeeping and hair-cutting, etc.).  To which he said, “What, you want to try to time the market?”

Our strategy has just been to do dollar cost averaging through identical automatic investments every month in a variety of different funds.  It’s worked out well for us thus far, although we do occasionally make large purchases (from tax returns or bonuses) into our existing stock and bond funds.  When we have extra money to invest, it makes sense to spread it out and maintain a diversified portfolio – stocks, bonds, REITs, international, domestic, etc.


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