Is It Really Safe to Invest in the S&P 500 at Record Highs? History Offers a Clear Answer.

After falling around 9% from its all-time high in March, the S&P 500 (SNPINDEX: ^GSPC) sharply reversed course and continued setting new records in April and May. Year to date, the index is up 9%.

After double-digit gains in 2023, 2024, and 2025, investors who've missed out on any part of this rally might feel like it's too dangerous to put money in stocks at record highs. In times like these, you often hear the refrain: "It's too late."

The truth is that if you're a long-term investor, it's almost never too late. Even if you invest at the peak of some of the worst bear markets in history, your chances of experiencing another eventual new high are pretty darn good!

Image source: Getty Images.

How buying at market peaks still works out

2026 is a good example of what can happen during more normal market conditions. Even with concerns about inflation, the Iran war, and the growing belief that the Fed won't be able to cut interest rates this year, the S&P 500 has set 24 new all-time closing highs so far this year. Even if you'd invested right before the 9% pullback earlier this year, you would have been back to breakeven within a month.

Clearly, setting an all-time high doesn't preclude the S&P 500 from setting a new all-time high very quickly.

But the worst-case scenario is what investors worry about: the massive bear markets that take years, not days, to recover from. How about those situations?

There have been three major extended bear markets this century -- the tech bubble, the financial crisis, and the 2022 Fed-induced bear. Granted, it would have taken years and a lot of patience to ride these bear markets out. But if you had, you would have recovered completely. If you'd stayed invested, you would have actually been sitting on some solid gains!

Price return only. Dividends reinvested would increase total returns. Data as of June 8, 2026. Data source: S&P 500 index historical price data.

The 2000-2013 period would have been especially painful. Just as the S&P 500 finally regained its previous high seven years earlier, it entered the financial crisis and another deep bear market.

But even riding out that full 13-year marathon of zero returns would have resulted in a total return of well over 300%, had you continued to hold that position until today.

The 2022 bear had a comparatively quick return. The decline hit its bottom in late 2022, but the market had recovered all of those losses completely by roughly the end of 2023. Of course, the artificial intelligence (AI) rally meant investors would have still been up more than 50% in total had they hung on.

Add in reinvested dividends in those cases, and total returns were even better.

The idea that new all-time highs are bad entry points simply doesn't hold up. Most all-time highs are followed up with new highs shortly thereafter. The deepest bear markets that take years to recover from get most of the attention, but they're the outliers.

Either way, long-term investors shouldn't be deterred by what price they're buying at, as long as they remain invested.

I'd keep investing in the Vanguard S&P 500 ETF (NYSEMKT: VOO), the iShares Core S&P 500 ETF (NYSEMKT: IVV), and other similar exchange-traded funds as long as you have years to stay invested.

David Dierking has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.