You finally get up the courage to make a sizable lump-sum investment, and just after your money hits the fund the market falls out of bed. But by putting a smaller amount of money into a fund on a regular basis, you can benefit from the market's volatility. AIPs take that factor away and give investors more opportunity for success. Automatic investment plans do carry a few disadvantages. Since a fund will draw money directly from your bank, you can incur charges if you forget to leave enough money in the account to cover the withdrawal.
People think of AIPs as being for young or new investors.
But they apply to even the wealthiest investor. Steve Norwitz, vice president of T. Rowe Price, agrees. I don't know why people wouldn't opt for the convenience and discipline of systematic investing. Institute for Econometric Research Reproduction in whole or in part without permission is prohibited. Our Privacy Policy .