Is It Better to Buy Crypto Weekly or Monthly?

You’ve decided to invest in cryptocurrency, and you’ve wisely chosen to use dollar cost averaging rather than throwing all your money in at once. Smart move. But now you’re facing another decision: should you buy crypto every week, or is it better to make monthly purchases?

It’s a question that seems simple on the surface but actually involves several factors worth considering. The frequency of your purchases can affect your returns, your transaction costs, the time you spend managing investments, and even how you experience the emotional rollercoaster of crypto investing.

The good news? There’s no objectively wrong answer here, but there is likely a better answer for your specific situation. Let’s explore the pros and cons of both approaches so you can make an informed decision.

Understanding Dollar Cost Averaging Frequency

Before we dive into weekly versus monthly, let’s clarify what we’re talking about. Dollar cost averaging means investing a fixed amount of money at regular intervals, regardless of the price. Whether Bitcoin is at $40,000 or $60,000, you invest your predetermined amount on your predetermined schedule.

The question of frequency matters because crypto prices can swing dramatically within short timeframes. The more frequently you buy, the more price points you capture, which theoretically smooths out volatility. But more frequency also means more transactions, and that can come with downsides.

The Case for Weekly Crypto Purchases

Buying crypto every week means you’re making roughly 52 purchases per year. This high frequency approach has several advantages that appeal to many investors.

First, weekly purchases capture more data points across the market’s ups and downs. Crypto can move significantly within a month, so buying weekly ensures you’re not accidentally buying only during a brief period when prices happen to be elevated. You’ll catch some peaks and some valleys, which is exactly what dollar cost averaging aims to do.

Second, weekly investing creates a consistent habit. When you’re buying every week, usually on the same day like every Monday or Friday, it becomes part of your routine. This regularity can help you stick to your investment plan rather than getting distracted or forgetting to invest.

Third, there’s a psychological benefit to smaller, more frequent purchases. If you have $400 to invest each month, putting in $100 per week can feel more manageable and less stressful than investing the full $400 at once. If the market drops right after you buy, you’ll only have one week’s investment at that higher price rather than a full month’s worth.

Weekly purchases also keep you more engaged with the market. You’ll naturally pay attention to crypto news and price movements, which can be educational, especially for beginners who are still learning how the market works.

The Case for Monthly Crypto Purchases

On the flip side, monthly purchases involve making just 12 transactions per year, and this approach has its own compelling advantages.

The most obvious benefit is lower transaction fees. Every time you buy crypto, you typically pay a fee to the exchange. These fees might be a flat amount or a percentage of your purchase, but either way, they add up. If you’re paying $2 per transaction, that’s $104 annually for weekly purchases versus just $24 for monthly purchases. On a $5,000 annual investment, that difference of $80 represents 1.6% of your capital.

Monthly investing also saves you time and mental energy. Instead of thinking about crypto every week, you make one purchase per month and move on with your life. For busy people or those who find constant market monitoring stressful, this reduced frequency can be liberating.

There’s also something to be said for allowing your investment to compound with fewer interruptions. When you buy monthly, your holdings have more time to potentially grow before you add more capital. While this doesn’t necessarily lead to better returns, some investors find it psychologically satisfying to see their investment grow between purchases.

Additionally, monthly purchases align nicely with how most people receive income. If you get paid monthly or budget on a monthly basis, investing monthly fits naturally into your financial routine. You can allocate your investment funds when you receive your paycheck and not think about it again until next month.

Transaction Fees: The Hidden Cost

Transaction fees deserve special attention because they can significantly impact your returns, especially with smaller investment amounts. Let’s look at a concrete example.

Suppose you invest $200 per month in crypto, and your exchange charges 1.5% per transaction. With monthly purchases, you’d pay $3 per transaction or $36 annually. With weekly purchases of $50, you’d still pay 1.5% per transaction, which is $0.75 per week or about $39 annually.

In this scenario, the difference is minimal. But if your exchange charges higher fees or if you’re investing smaller amounts, the gap widens. Some exchanges charge $2 or more per transaction regardless of size. Weekly $25 purchases would cost $104 in annual fees at $2 per transaction, while monthly $100 purchases would cost just $24.

Many modern exchanges offer lower fees for larger transactions or have fee structures that favor less frequent purchases. Before deciding on your frequency, check your exchange’s fee schedule carefully.

Market Volatility and Price Averaging

From a pure price averaging perspective, weekly purchases theoretically provide better smoothing of volatility. Crypto markets can move 10%, 20%, or more within a single month, so buying four times during that month captures more varied price points than buying once.

However, research on traditional stock markets suggests that the difference in returns between weekly and monthly dollar cost averaging is usually minimal over long periods. While weekly purchases might slightly reduce your average cost per coin in highly volatile months, monthly purchases might come out ahead in steadier months.

The reality is that both approaches successfully accomplish the main goal of dollar cost averaging: avoiding the risk of putting all your money in at a market peak. Whether you buy weekly or monthly, you’re spreading your risk across time, which is the important part.

Your Investment Amount Matters

The size of your investment should influence your decision. If you’re investing just $100 per month total, splitting that into weekly $25 purchases might not make sense, especially if fees are a concern. The administrative overhead of four transactions instead of one may outweigh any benefit from additional price averaging.

On the other hand, if you’re investing $1,000 or more per month, weekly purchases of $250 might be more appropriate. At this level, transaction fees are less impactful as a percentage of your investment, and you have more capital at risk that could benefit from additional price averaging.

A reasonable guideline is that each individual purchase should be at least $50 to $100 to keep fees reasonable. If weekly purchases would put you below this threshold, monthly investing probably makes more sense.

Emotional and Behavioral Considerations

Don’t underestimate the psychological aspects of your choice. Some people find weekly investing helps them stay disciplined and engaged. The regular routine prevents them from overthinking market conditions or getting cold feet about investing.

Others find weekly investing creates too much anxiety. Constantly monitoring prices and making decisions can be mentally exhausting, especially during volatile periods. For these people, monthly investing offers peace of mind and reduces the emotional burden of crypto investing.

Consider your personality honestly. Are you someone who thrives on routine and engagement, or do you prefer to set things and forget them? Your answer should inform your frequency choice.

A Hybrid Approach

Who says you have to choose? Some investors use a hybrid approach, making larger monthly purchases but also adding smaller weekly purchases when they have extra money or when prices dip significantly.

Others invest weekly during particularly volatile periods when prices are swinging wildly, then switch to monthly purchases during calmer market conditions. This flexible approach lets you adapt to changing circumstances.

You might also consider starting with weekly purchases as a beginner to build the habit and learn the market, then transitioning to monthly purchases once you’re more comfortable and knowledgeable.

The Bottom Line

So, is it better to buy crypto weekly or monthly? For most investors, monthly purchases offer the best balance of price averaging, fee efficiency, and convenience. Monthly investing captures sufficient price variation to accomplish dollar cost averaging goals while minimizing transaction costs and time investment.

However, weekly purchases can make sense if you’re investing larger amounts where fees are less impactful, if you benefit psychologically from more frequent engagement, or if you’re in a particularly volatile market period.

Ultimately, the best frequency is the one you’ll actually stick with consistently. Whether you choose weekly, monthly, or something in between, the most important factor is maintaining your investment discipline over time. Consistency beats perfection every time in the world of investing.