Why "Bad Timing" Beats "No Timing"

A famous Schwab Center for Financial Research study compared different investor personalities over 20 years. They found that an investor who accidentally invested at the market peak every single year (the worst possible timing) still fared significantly better than an investor who stayed in cash waiting for the "right time."

The Math: The "Worst Timer" ended up with 3x more wealth than the "Procrastinator" who stayed in cash, simply because they benefited from the market's long-term upward trend and dividend reinvestment.

Summary of Risks

Locking in Losses: Selling after a drop turns a "paper loss" into a permanent loss of capital.
Missing the Rebound: Most market gains happen in sudden, violent bursts. Missing just one or two of these can set a retirement plan back by a decade.
The Entry Problem: Investors who exit usually struggle to decide when it is "safe" to get back in, often waiting until prices are already higher than where they sold.

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