Recent market fluctuations have left many investors feeling uneasy. At Earned, we understand that as a doctor, your time is valuable and you shouldn’t have to spend it stressing over market swings. Our goal is to provide clarity and confidence, helping you navigate this period of economic uncertainty with a long-term view. ‍‍‍

Market volatility is nothing new

Since the Great Depression, investors have faced a constant stream of concerns, from wars and recessions to inflation spikes and financial crises. Yet, despite these challenges, the market has historically rebounded and continued its upward trajectory. Consider these past events:

• 1962: The Cuban Missile Crisis causes worldwide panic.
• 1973-74: OPEC oil embargo and Watergate scandal triggered a 50% market drop.
• 1987: Black Monday saw a 22% decline in a single day.
• 2000-02: The dot-com bubble burst, leading to a nearly 78% drop in the NASDAQ.
• 2008-09: The financial crisis wiped out nearly 57% of the S&P 500’s value.
• 2020: The COVID-19 crash saw markets decline over 30% in just weeks.

Despite these downturns, the market has recovered every single time, rewarding those who stayed invested. It’s important to remember that bear markets are temporary  — they occur roughly every six years but are followed by strong recoveries.

The power of a balanced portfolio

Investors who stick to a well-structured financial plan are more likely to achieve their long-term goals. The chart below shows historical investment returns by asset class from 2014 to 2024. As you can see, predicting which asset will perform best is difficult — but a balanced portfolio (shown in bright green) offers a smart way to navigate volatility.

Compounding works wonders

Compounding is one of the most powerful ways to drive long-term wealth. As shown in the chart below, if you saved $50,000 per year and invested it consistently for 30 years, assuming an 8% annualized return, you could accumulate $5.7 million.

But it’s not just about saving — it’s about letting your returns generate their own returns over time. While market downturns are inevitable, staying invested allows you to benefit from the market’s long-term growth.

Time in the market beats timing the market

Take a look at the chart below — it shows how missing just a handful of the market’s best days over time can significantly reduce your portfolio’s growth. Market timing is difficult, and reacting to short-term volatility often does more harm than good. Staying invested, even during downturns, gives you a much better chance of reaching your long-term financial goals.

Turning volatility into opportunity

We believe market fluctuations present opportunities for strategic financial planning. Here’s how we help our clients:

• Rebalancing and buying at a discount: We all love a good sale. Market dips offer opportunities to purchase assets at lower prices, taking advantage of long-term growth potential.
• Tax-loss harvesting: Volatility allows for strategic tax planning, reducing taxable income while positioning your portfolio for future gains.
• Stress testing your financial plan: We can help you evaluate how different market scenarios impact your long-term goals, providing confidence in your strategy.

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Staying focused on what matters

Market headlines may be filled with doom and gloom, but history shows the market rewards patience and discipline. Instead of reacting emotionally, focus on what you can control: diversification, asset allocation, and a solid financial plan.

As a doctor, you dedicate your life to improving others’ well-being. We’re here to help ensure your financial well-being remains on track, so you can focus less on the market headlines and more on what really matters.

If you have concerns or want to review your investment strategy, our team at Earned is here to help.