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Episode Summary

With the stock market trading near all-time highs again, it's natural to wonder — should you be worried? Is a crash inevitable? Should you hold off on investing?

In this rewind of one of our most popular 2024 episodes, we dig into what history actually tells us about all-time highs in the stock market — and why optometrists should stay the course with the long-term investment plan they've already built.

What You'll Learn

How common all-time highs actually are historically
Average S&P 500 returns one, three, and five years after record highs
How often significant market corrections follow all-time highs
Why declines are a normal and expected part of long-term investing
What optometrists should focus on instead of market noise

Key Takeaways for Optometrists

All-time highs sound alarming — but history says otherwise. Since 1950, the S&P 500 has hit roughly 1,250 all-time highs, averaging about 16 per year. Research from Dimensional Fund Advisors shows that average returns one, three, and five years after record highs are nearly identical to returns after any other given month. And data from RBC Global Asset Management found that only 9% of all-time highs were followed by a 10%+ decline within one year — with that number dropping to 0% over a five-year window.

None of this means declines don't happen — they do, and they're a normal part of investing. But for long-term investors, the focus belongs on the things within your control: your savings rate, your practice, your career, and maintaining the right investment mix for your goals. The headlines will always find a reason to worry. Your job is to tune them out and stay invested.

Resources for Optometrists

Podcast Ep 153: How to Invest Tax-Efficiently and Keep More of Your Returns (After-tax)
Podcast Ep 140: What Most Investors Get Wrong About Dividend Investing
DFA: Why A Stock Peak Isn't A Cliff
RBC GAM: Investing at All-Time Highs
Have a question for a future episode? Email: podcast@optometrywealth.com

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The Optometry Money Podcast is dedicated to helping optometrists make better decisions around their money, careers, and practices. The show is hosted by Evon Mendrin, CFP®, CSLP®, owner of Optometry Wealth Advisors, a financial planning firm just for optometrists nationwide.