Periods of extreme volatility in the stock market may feel painful for investors — but such periods are generally followed by strong stock returns, if history is a guide, according to market analysts.

In that sense, many investors would be wise not to sell stocks — and should perhaps even buy more, analysts said.

The VIX index, also known at the Wall Street fear gauge, measures the market’s estimate of expected volatility in the S&P 500 stock index.

When the VIX has spiked to a level above 40 — indicating “significant” volatility — the S&P 500 has been up 30% a year later, on average, according to a Wells Fargo Investment Institute analysis of the market from January 1990 to April 16, 2025.

The odds of stock returns being positive 12 months later were also above 90% during these periods, the analysis found.

In other words, volatility creates a “potential opportunity,” Edward Lee, a Wells Fargo investment strategy analyst, wrote in the analysis on Monday.

“Concern is normal, but history has taught us that periods of higher volatility have historically led to higher returns,” Lee wrote.

So, why is there a greater probability of positive and higher stock returns relative to periods of lower volatility?

Volatility “tends to coincide with times of high drawdowns and investor panic, both of which lead to higher probabilities of investing success of the next 12 months,” Lee wrote in an e-mail.

Stock volatility spiked in early April after President Donald Trump announced unexpectedly high country-specific tariffs, and the S&P 500 sold off almost 11% in two days.

The VIX reached about 53, among the top 1% closes for that index in history, Callie Cox, chief market strategist at Ritholtz Wealth Management, wrote last week.

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But low expectations often lead to “relief rallies,” when people pile back into stocks because the initial news isn’t quite as bad as they thought, Cox wrote.

For example, since 1990, about half of the S&P 500’s 14 selloffs of 10% or more ended within a week of the VIX’s highest close, and three ended on the day of its highest close, Cox wrote.

Such selloffs are usually “V-shaped,” meaning there’s a sharp downturn and then a quick rebound, she said in an interview with CNBC.

However, things could be different this time around, she said.

“We’re [still] trying to figure out where the new center of gravity is” with trade policy, Cox said.

“The unexpected news part of the sell-off is probably past us, and if you are a long-term investor, now is probably the time to start buying,” Cox said. “But you can’t expect this to be the bottom of the sell-off. And history isn’t always gospel.”

House Education and Workforce Committee Republicans have released their plan to overhaul the country’s student loan and financial aid system, calling for limits on student borrowing and a reduction to the repayment options for borrowers.

The GOP measure, known as the Student Success and Taxpayer Savings Plan, is aimed at helping Republicans pass President Donald Trump‘s tax cuts.

“For decades Congress has responded to the student loan crisis by throwing more and more taxpayer dollars at the problem — never addressing the root causes of skyrocketing college costs,” committee Chairman Tim Walberg, R-Mich., said in a statement.

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The proposal immediately triggered warnings from consumer advocates, who said the measures would deepen the affordability crisis families already face in paying for college.

“The committee’s current proposal would severely restrict college access by slashing financial aid programs, eliminating basic consumer protections and making it harder to repay student loan debt,” said Sameer Gadkaree, president and CEO of The Institute for College Access & Success.

Here are some of the proposals in the Republicans’ legislation.

That’s a concern for Kantrowitz and other consumer advocates, who point out that private student loans come with far fewer borrower protections than federal student loans.

The GOP proposal would reduce the number of existing income-driven repayment plans for new federal student loan borrowers to just one. IDR plans aim to make monthly payments affordable for borrowers by capping the bills at a portion of their discretionary income.

More than 12 million people were enrolled in IDR plans as of September 2024, according to Kantrowitz.

It would also eliminate the unemployment deferment and economic hardship deferment for federal student loan borrowers, on debt taken out during or after July 2025.

The federal Pell Grant program, signed into law in 1965, is one of the largest sources of financial aid available to college students. More than 6 million undergraduate students received the grants in 2020. The maximum Pell Grant award is $7,395 for the 2025-26 award year.

Meanwhile, the grants would be expanded for short-term workforce training programs.

Picking a college is a major decision, but figuring out how to pay for it is an even bigger commitment.

And with just a few days before National College Decision Day on May 1, many families are struggling to come to terms with both finding the “right-fit” school as well as wrestling with the sky-high cost and looming student debt balances. And all this while opportunities for federal loan forgiveness are dwindling.

“Choosing a school is a personal and individual decision,” said Chris Ebeling, head of student lending at Citizens Financial Group.

Academics, extracurriculars, campus culture and career services are key considerations, he said, but “it’s not just about the dream school and the academics and setting you up for the right career trajectory, it’s also about the cost — that is a real issue.”

To that end, experts share their best advice on how to frame your decision before choosing a school, including coming up with a plan for how to pay for it and factoring in financial aid.

The net price is the total cost of attendance, including tuition and fees, minus grants, scholarships and education tax benefits, according to the College Board.

Even though the price tag for a college education has never been higher, nearly 75% of all undergraduates receive some type of financial aid, according to the National Center for Education Statistics, which can bring the cost significantly down. 

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Most colleges have a net price calculator on their websites to help students determine their out-of-pocket expenses. However, “some are better than others,” Ebeling said.

He recommends other online resources to get an even more accurate picture, such as MyinTuition or the College Board’s net price calculator.

“A good net price calculator would be within a few thousand dollars,” Ebeling said.

The net price can also vary greatly between schools.

“At Harvard, for example, the sticker price is very high, but the net price is very low,” Ebeling said.

Or, Ebeling added that “you could look at a state school where the sticker price is lower but they provide less assistance and the net price is higher.”

In fact, when it comes to offering financial assistance, private schools typically have more money to spend, other experts also say, and some are increasingly boosting their financial aid awards.

For a majority of students and their families, financial aid is the most important factor in their decisions about choosing where to attend and how to pay the tab. But not all financial aid is equal either.

The amount of aid offered matters, as does the breakdown between grants, scholarships, work-study and student loans.

Once students fill out the Free Application for Federal Student Aid, which serves as the gateway to all federal money, they will receive their award letters.

In most packages, there are several financial aid options. The goal is to maximize gift aid — money that doesn’t need to be paid back, such as scholarships, fellowships and grants — and minimize loans that will need to be repaid with interest.

“There is a hierarchy of sources of funding,” Ebeling said. “The first, and most obvious, is the free money.”

But even with gift aid, it’s important to read the fine print, such as whether a grant is renewable for all four years or whether a minimum grade point average must be maintained. It’s worth noting that if a student fails to meet the terms, such as a grade point average requirement, they may have to repay some or all of a grant or scholarship.

Beyond the college aid offer, there are still alternative sources for merit-based aid out there, according to Matt Lattman, a senior vice president at Discover.

“There are many different scholarships that can be based on talents and interests, membership in professional or social organizations, or even luck of the draw,” Lattman said. Some scholarships are annual, others per semester, and some even provide a monthly opportunity to earn money towards your education, he added.

Students can ask their high school counselor about opportunities or search websites such as Scholarships.com or the College Board.

Considering that tuition adjustments average roughly 5% a year, if you know you are going to need to borrow, start with federal direct subsidized and unsubsidized loans, he said. “Generally those are the best loans out there.”

Still, it’s also never too late to fund a 529 college savings plan, which comes with added tax benefits and increased flexibility.

Plus, anyone can contribute — and for grandparents, there is also a new “loophole,” which allows them to pad a grandchild’s college fund without impacting their financial aid eligibility.

Most importantly, “every dollar saved is a dollar less you have to borrow later,” said Smitha Walling, head of Vanguard’s education savings group.

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