If you've spent any time following financial news recently, you've almost certainly seen headlines announcing that the S&P 500 is once again sitting at or near an all-time high. Almost immediately, another wave of questions follows for most investors. Is it a bad time to invest when the stock market is high? Should I wait? Did I already miss my chance? Isn't it risky to start investing now?

It's probably one of the most common investing questions I receive, whether from physician colleagues, readers of this blog, or people posting in online finance communities. It seems like a perfectly reasonable concern. After all, nobody likes the feeling of buying something at its highest price.

But that question actually reveals something much bigger. It assumes that successful investing depends on figuring out where the market is headed next. Fortunately, that's simply not true.

In fact, one of the biggest reasons I advocate for low cost, broadly diversified index fund investing is because it removes the need to predict the future. Your investing success shouldn't depend on having a crystal ball. It should depend on having a plan.

So when is the best time to invest?

If this were Intro to Personal Finance for Doctors 101, the first question on the final exam would be:

When is the best time to invest in the stock market?

• A. When the market is at an all-time low
• B. When the market is at an all-time high
• C. Somewhere in between
• D. All of the above

The answer is D.

That answer surprises a lot of people because we're taught from the beginning to “buy low and sell high.” That's what rebalancing your investment portfolio is actually designed to do. While that's true in theory, the problem is that nobody knows when “low” actually is until after the fact. Likewise, today's all-time high may end up looking like a bargain ten or twenty years from now.

Trying to identify the perfect entry point usually does more harm than good because it encourages us to focus on short-term prices instead of long-term investing.

Long-term investing changes the question

The real issue is that many people are asking the wrong question.

Instead of asking whether today's price is attractive, long-term investors should ask whether they believe businesses will continue creating value over the next twenty or thirty years.

That's a very different conversation.

My investment strategy has never been based on predicting what the market will do next month or next year. Instead, it's based on participating in the long-term growth of businesses and the overall domestic and international economy through low cost, broadly diversified index funds.

If you've read my post about boring index funds, you know that I don't think investing should be exciting. In fact, one of the reasons I love index fund investing is precisely because it's boring. The less often I feel compelled to make investment decisions, the fewer mistakes I tend to make.

History certainly doesn't guarantee future returns, but despite recessions, wars, inflation, financial crises, and political uncertainty, the stock market has rewarded patient investors over long periods. In fact, there are really only 4 big threats to the overall economy and, in turn, a well diversified investment plan. And thankfully they are pretty rare.

When your investing horizon is measured in decades instead of months, today's price matters much less than your ability to consistently keep investing.

What waiting really means

Whenever someone tells me they're waiting because the market is “too high,” I like to point out what they're really saying.

They're making two predictions. First, they're predicting that the market will decline. Second, they're predicting they'll know exactly when to invest again before the market recovers.

Neither prediction is easy. Making both correctly is extraordinarily difficult.

That's market timing.

Unfortunately, decades of research have shown that investors are remarkably poor at consistently timing the market. Even professional fund managers with enormous research staffs rarely accomplish it over long periods. Morningstar has repeatedly demonstrated how investor behavior, rather than investment selection, often hurts returns because people buy and sell at the wrong times. Their annual Mind the Gap study is an excellent illustration of this phenomenon.

The biggest challenge isn't simply missing the bottom. It's missing the recovery. Some of the market's strongest days have occurred immediately after some of its worst ones. Investors sitting on the sidelines waiting for certainty often miss those gains, and missing only a handful of those days can dramatically reduce long-term returns.

That's why I'd rather build a financial plan that doesn't require me to make those predictions in the first place.

Why this matters right now

This discussion feels particularly relevant because, as I write this, the S&P 500 is once again trading near all-time highs.

As always, that has led many investors to wonder whether they've already missed the opportunity and whether it would be smarter to wait for the next correction.

The truth is that this same question gets asked almost every time the market reaches a new high.

Ironically, that's because the market spends far more time making new highs than most people realize.

Healthy businesses become more productive over time. They innovate. They earn higher profits. The economy grows. If all of those things continue happening over decades, then it should not surprise us that the stock market continues reaching new highs.

In fact, an all-time high isn't evidence that something is wrong.

It's often evidence that long-term investing is working exactly as expected.

What history says about investing at all-time highs

The nice thing is that we don't have to rely only on theory here. We have decades of data examining exactly what happens when investors buy at new market highs.

Researchers have repeatedly studied the returns earned by investors who bought the S&P 500 immediately after it reached a new all-time high. Intuitively, you might expect those investors to underperform because they supposedly “bought at the top.”

That's simply not what happened.

AllianceBernstein examined market data dating back to 1980 and found that investors purchasing at all-time highs earned average one-year returns of approximately 10.5%, with nearly 78% of those one-year periods ending positive. Looking three years out, the average cumulative return was approximately 36.7%, and nearly 87% of those periods produced positive returns.

Perhaps even more interesting, those returns were almost identical to investors who happened to buy on any random trading day.

RBC Global Asset Management reached a similar conclusion after examining more than 1,300 all-time highs dating back to 1950. Their research found that investors buying at record highs generally earned returns very similar to long-term averages over the following one-, three-, and five-year periods. They also found that corrections of greater than 10% occurred within the following year after only about 9% of those all-time highs.

Why?

Because markets rarely reach one new high and immediately collapse

Bull markets tend to produce strings of new highs.

Think back over the past decade. The market reached record highs in 2013, 2014, 2017, 2019, 2021, 2024, 2025, and now again in 2026. Investors waiting on the sidelines because the market looked “too expensive” often watched prices continue climbing while they waited for a correction that either never arrived or arrived only after prices had risen substantially higher.

None of this guarantees that buying today means positive returns over the next few months. Sometimes markets do fall shortly after making new highs. Anyone investing in late 2021 certainly remembers that experience.

But that's the wrong benchmark.

The real question isn't whether the market will be lower next year. The real question is where you expect it to be twenty or thirty years from now.

Those are entirely different questions, and long-term investors should care much more about the second one.

The market spends a surprising amount of its life making new highs. If your investing strategy requires avoiding new highs, your strategy requires avoiding one of the market's most normal behaviors.

Market declines aren't something to fear

Ironically, when markets fall, people begin asking the opposite question. Instead of wondering whether they should wait to invest, they wonder whether they should stop investing altogether.

Again, my answer doesn't change.

If you're investing for retirement thirty years from now, lower stock prices aren't necessarily bad news. They're an opportunity to buy more shares with the same amount of money. And if you are closer to retirement, your asset allocation should steer much more towards bonds and safer assets less prone to the fluctuations of the stock market. As such, investors of any season with a solid all weather investment plan don't need to fear a market high or low. Even if you are getting a later start on your investing career, there are strategies to help you reach your goals despite current market conditions.

It's funny when you think about it. We get excited when our favorite store announces a 30% off sale. Yet when stocks become 30% cheaper, many investors with a long time horizon panic.

Emotion explains that reaction. Logic doesn't.

That's one reason I've previously written about staying invested during stock market corrections. Corrections and bear markets aren't flaws in the investing process. They're part of the process.

Consistency is your greatest advantage

One of the biggest advantages individual investors possess has nothing to do with intelligence or access to information.

It's consistency.

We don't have to outperform Wall Street (a fool's errand to begin with). We don't need to discover the next great company. And we don't have to predict interest rates, inflation, or earnings reports.

Instead, we simply need a process we can continue following regardless of whether headlines are optimistic or terrifying.

For many people, that means investing automatically every paycheck or every month. Sometimes those purchases happen at a record stock market high. Sometimes they happen during bear markets. Most occur somewhere in between.

That's exactly how long-term investing is supposed to work.

Rather than making an emotional decision every month, you've already made the decision once by creating your plan.

This is why I have a written financial plan

One of the biggest benefits of creating a written financial plan is that it removes emotion from important financial decisions.

When markets are climbing rapidly, your plan reminds you to keep investing.

When markets are falling rapidly, your plan reminds you to keep investing.

And when headlines insist that “this time is different,” your plan reminds you that every previous generation thought exactly the same thing.

That's one reason my financial plan has changed very little over the years. As I discussed in my post on my updated financial plan, resisting the urge to constantly tinker has probably been one of my greatest financial advantages.

The final word on investing in a stock market high AKA now

Every generation eventually becomes convinced that the market is either too expensive or too dangerous to invest in.

History suggests otherwise.

If your investing strategy depends on correctly identifying the perfect entry point, you're asking yourself to do something that even professional investors struggle to accomplish.

Instead, build a plan that succeeds without requiring perfect predictions.

Whether the market is at an all-time high, recovering from a correction, or trading somewhere in the middle, your job remains the same. Continue investing consistently, stay diversified through low cost index funds, keep your costs low, and allow time to become your greatest investing advantage.

Eventually you'll stop worrying about whether today is the perfect day to invest.

You'll simply recognize that, if you're investing for decades rather than days, today is almost always a good day to follow your plan.

If you'd like to explore these ideas further, these posts provide additional context:

• Updated Financial Plan: https://prudentplasticsurgeon.com/updated-financial-plan/
• Boring Index Funds: https://prudentplasticsurgeon.com/boring-index-funds/
• Expected vs. Actual Net Worth: https://prudentplasticsurgeon.com/expected-net-worth/

What do you think? Should we invest in a market high? Why or why not? Do you invest during a market high? IS there any time you don't invest? Let me know in the comments below!