Is this time different?

When stocks start to move up and down quickly, everybody starts to ask the same question:  Is this time different?

The simple answer is, of course it is different!  Every market environment has different aspects that make it unique.  Currently the country is at full employment, with low interest rates relative to historical standard, in a booming stock market that has high valuations relative to historical PE ratios, that just passed a tax cut during a growth cycle and just passed a budget that increases government spending without revenue to offset those expenditures.  In that terrible run on sentence there is a combination of factors that make this time unique.

What isn’t unique for retirement investors is their long term horizon.  Someone in their 40’s has 20+ years of saving left and probably 40 to 50 years left in their life.  They have to maximize their savings rate to fund what will probably be a unique retirement.  They likely don’t have a pension and have to rely solely on their own retirement savings to fund an expanded life expectancy from prior generations.

Will the market be higher in one year?  We have no idea.  Will it be higher in 10, 20 or 30 years?  I sure hope so and using history as a guide, it typically has been.