Time in the Market Beats Timing the Market

The U.S. minted more than 379,000 millionaires last year...

That's more than a thousand every single day. But the biggest wealth surge of the year didn't come from luck or leverage.

It wasn't crypto. It wasn't private equity. It wasn't some secret investing club with early access to hot IPOs.

It was the good ol' stock market.

According to investment bank UBS, total global wealth rose 4.6% last year. But the U.S. outpaced every other nation in average wealth gains.

European heavyweights like France, Germany, and Belgium fell in the rankings. Meanwhile, U.S. investors rode a nearly 24% surge in the S&P 500 to new highs.

It's a remarkable reminder of just how powerful a long-term investing strategy can be... And why the key to wealth creation isn't timing the market – it's staying in.

For most folks, the biggest gains don't come from hopping in and out at the right time...

They come from showing up and sticking around.

If you held on throughout 2024, you know what I'm talking about. Your portfolio likely got a nice boost as the S&P 500 climbed. The tech-heavy Nasdaq was up nearly 29%.

These kinds of broad-based rallies don't just benefit a handful of hedge funds or algorithmic traders. They lift retirement accounts... and turn steady savers into millionaires.

Compound interest is the most powerful engine behind that transformation. Any time your portfolio's value rises, you have a bigger base to grow in the future. The same is true if a company pays a dividend that you reinvest.

Every time you try to jump in and out of the market – whether it's to avoid downturns or chase rallies – you risk missing the most powerful up days.

And that's a much bigger deal than it might seem. Missing just the 10 best days in the market since 1995 would cut your returns by 54%.

Put simply, compounding works best when you don't interrupt it.

The surge in new millionaires showcases an important lesson for Americans...

If you want to build generational wealth, you must have money in the stock market.

From pensions to stock-based compensation, exposure to equities is baked into how the U.S. builds wealth.

And that wealth gets funneled back into the economy through spending and investing, reinforcing the cycle.

But there's an important caveat... As crucial as it is to put money in the market, you shouldn't bet it all on stocks.

When it comes to creating wealth, timing is everything – but I'm not talking about timing the market.

I'm talking about timing your own investments.

No investment can guarantee you'll earn your money back over a short time frame...

That might not be what you want to hear. But it's the truth.

So when you're ready to buy in, you must also consider when you'll need that cash... and how much.

I've spent years studying the best (and worst) ways to put money to work. And I've winnowed it down to three simple buckets – what I call my "3-Stock Secret."

The 3-Stock Secret is as straightforward as it sounds. You put your money into just three investments. The exact three you choose will look a little different for everyone. But the setup is the same.

Then, you let them ride.

There's no jumping in and out, trying to predict where the market will go next. You don't need to worry about the "hottest" trends... or whether you've missed the boat on the latest market darling.

I consider the 3-Stock Secret one of my most powerful investing strategies. I use it for much of my own money. So does Director of Research Rob Spivey. (For that matter, so does my own mom.)

You can learn more about it right here.  

If 2024 made anything clear, it's that compounding works best for those who stay in the game.

You can't predict the best days... but you can participate in them.

Regards,

Joel Litman
July 15, 2025