I was corresponding with a reader over Facebook when I got asked this good question. Should he lower his monthly Dollar-Cost Averaging (DCA) investment amount for now given the current high pricing levels of the equity markets and subsequently increase it when the prices come down? My advice was that it’s a good idea since that keeps you vested in the equity markets but doesn’t raise your average purchase price as quickly while allowing you to lower it more efficiently.

That’s when I realized I have been doing the opposite of my advice. In my effort to utilize more of my cash holdings, I have been investing more every month but with the way equity markets have been climbing, this has been averaging up my purchase price consequently. Unwise because I don’t actually need to invest more now since we are still employed with salary income and not in a rush to achieve financial …