Shutdown in the Headlines. Here's What to Keep in Mind.
You’ve probably seen the headlines: the U.S. government has shut down again.
It is the kind of story that dominates the news cycle, stirs up anxiety, and makes investors wonder, “Should I be doing something?”
But here is the thing: headlines are not the whole story. And a disciplined strategy does not panic over politics.
Let’s walk through what is happening, what it could mean for you, and why it is not a reason to hit the panic button.
A government shutdown happens when Congress cannot agree on a budget. Without a funding deal, certain government operations pause until lawmakers reach a compromise.
So what does this mean in practical terms?
- Some federal workers are furloughed without pay.
- Social Security checks still go out, but new applications or benefit changes could be delayed.
- Passport offices and IRS services may slow down or close.
- FAFSA processing and Medicare updates might take longer than usual.
And the markets? They tend to dislike uncertainty, but they have also shown a history of resilience.
Over the 22 shutdowns since 1976, the S&P 500's performance has varied—rising during some closures and falling during others. Across all these episodes, the average return was about 0.3%, suggesting these disruptions tend to have minimal lasting impact.1
Of course, past performance does not guarantee future results. Every shutdown is different. But historically, markets have often taken these disruptions in stride.
Which brings us to what really matters: your plan.
This is not the first shutdown, and it will not be the last. Markets rise. Politics clash. Headlines flare up.
But a plan should be designed for moments like this.
- Diversified? International exposure? You are spreading risk, not stacking it.
- Focused on the long term? You are built to ride out short-term noise.
- Working with a financial professional? You are not reacting. You are staying ready.
The goal was never to avoid uncertainty. It was to be prepared for it.
Sources:
1. CBS News, 2025 [URL: https://www.cbsnews.com/news/