By Krista Wallace, CFP®, AFC®
It’s election season again—and before you “sour” on the state of the world, it is important to take a higher perspective on all likely outcomes.
I have no desire to sugarcoat things: there are still concerns in our economy which we are paying close attention to. For example, the federal government ran a deficit of about $2 trillion in fiscal year 2026. The Federal Reserve held its policy-rate target at 3.75% to 4% on October 28, while borrowing costs and persistent inflation continue to squeeze household budgets.
The chart shows positive one-year returns following each of the 20 midterm elections from 1946 through 2022. Thirteen of those periods, or 65%, had double-digit returns.
That is a historical observation, not a forecast. The pattern may not continue, and stocks can lose value during or after an election, including over a full one-year period.
By the time you read this, Election Day will be behind us—even if some of the drama isn’t. As in every election, there will be winners and there will be losers. Likely a couple of upsets and questioning glances of “how did that happen?” History offers no guarantees, but the market’s record after midterm elections gives us a little something sweet to consider—regardless of how we voted.
Your advisor is ready to discuss the impact of election results with you at your fall meeting or at any time. We’re here to support you!