As you’ve likely seen, the federal governmentshut downas ofOctober 1, 2025. These episodes are frustrating and disruptive, but they’re not new, and history gives us a helpful perspective. Below are the key points we want you to know. 1) Social Security Benefits: Near-term and Longer-term - Payments will continue.Social Security is mandatory spending, not part of the annual appropriations thatshut down. The Social Security Administration follows a contingency plan that keeps benefits flowing even when parts of the government close. Some in-office services can slow or pause, but checks direct-deposited to you continue.1
- Longer-term solvency is a separate issue.Ashutdowndoesn’t change the underlying Social Security trust fund math; that’s a legislative/actuarial problem, not ashutdownproblem. Expect normal benefits now; any long-run changes (if Congress eventually enacts them) would come through separate legislation, not via ashutdown.2
2) What Past Shutdowns Did to the Stock Market - Historically, stock moves during shutdowns are modest—and often positive.Looking across shutdowns since the 1970s, the S&P 500 has been roughly flat on average during theshutdownwindow, with a slight tendency to rise rather than fall. In the 2013 16-dayshutdown, the S&P 500 dipped about2–3 percentat one point but finished the period up; during the 2018–2019 (35-day)shutdown, the S&P actually rose ~10 percent over the span. Past results don’t guarantee future outcomes.3
- Recoveries tend to be quick.Across shutdowns, the index has been highera majority of the time 1–12 months later, with one study showing the S&P 500 was higher~86 percent of the time a year later, averaging ~12–13 percent. Remember, past results don’t guarantee future outcomes.4
3) After the Recovery, Then What? - In cases where stocks fell during ashutdownand then recovered, markets often kept climbing alongside the broader economic and earnings backdrop. The 2013 and 2018–2019 episodes are good examples: after short-term volatility, indices moved to higher levels over the following months as investors refocused on fundamentals, interest-rate policy, and earnings. The same dynamic—policy noise vs. business results—tends to dominate once the headlines fade.
How We’re Positioned Our job is toseparate the signal from noise.Shutdowns can delay data releases and create short-term volatility, but they have not historically been a reason to rethink a long-term strategy. If this stretches on and new facts change the outlook, we might need to review our outlook. If you have questions or concerns, we’re here for you. |
1. SSA.gov, 2025
2. CRFB.org, March 14, 2025
3. Kiplinger.com, 2025
4. Bloomberg.com, September 30, 2025 |
