Since 1926, U.S. large-cap stocks have lost an average 0.9% in September, according to data from Morningstar Direct.
September is the only month during that nearly century-long period in which investors experienced an average loss, according to Morningstar. They saw a profit in all other months.
For example, February saw a positive 0.4% return, on average. While that performance is the second-lowest among the 12 months, is still eclipses September’s by 1.3 percentage points. July reigns supreme with an average return of almost 2%.
The monthly weakness also holds true when looking just at more recent periods.
For example, the S&P 500 stock index has lost an average 1.7% in September since 2000 — the worst monthly performance by more than a percentage point, according to FactSet.
Historically, the last two weeks of September are generally the weakest part of the month, said Abby Yoder, U.S. equity strategist at J.P Morgan Private Bank.
“Starting next week is when it would [tend to get] get a little bit more negative, in terms of seasonality,” Yoder said.
Trying to time the market is a losing bet
Alistair Berg | Digitalvision | Getty Images
Investors holding their money in stocks for the long-term shouldn’t bail, Yoder said.
Trying to time the market is almost always a losing bet, according to financial experts. That’s because it’s impossible to know when good and bad days will occur.
For example, the 10 best trading days by percentage gain for the S&P 500 over the past three decades all occurred during recessions, according to a Wells Fargo analysis published earlier this year.
Plus, average large-cap U.S. stock returns were positive in September for half the years since 1926, according to Morningstar. Put another way: They were only negative half of the time.
As an illustration, investors who sold out of the market in September 2010 would have foregone a 9% return that month — the best monthly performer that year, according to Morningstar.
“It’s all just random,” said Edward McQuarrie, a professor emeritus at Santa Clara University who studies historical investment returns. “Stocks are volatile.”
For example, the popular saying “sell in May and go away” would have investors sell out of stocks in May and buy back in November. The thinking: November to April is the best rolling six-month period for stocks.
It’s all just random.
Edward McQuarrie
professor emeritus at Santa Clara University
“History shows this trading theory has flaws,” wrote Fidelity Investments in April. “More often than not, stocks tend to record gains throughout the year, on average. Thus, selling in May generally doesn’t make a lot of sense.”
Since 2000, the S&P 500 saw gains of 1.1% from May to October, on average,over the six-month period, according to FactSet. The stock index gained 4.8% from November to April.
Historical reason for September weakness
There is a historical reason why stocks often fared poorly in September prior to the early 1900s, McQuarrie said.
It ties into 19th century agriculture, banking practices and the scarcity of money, he said.
At the time, New York City had achieved dominance as a powerful banking hub, especially after the Civil War. Deposits flowed to New York from the rest of the country during the year as farmers planted their crops and farmer purchases accumulated in local banks, which couldn’t put the funds to good use locally, McQuarrie said.
New York banks would lend funds to stock speculators to earn a return on those deposits. In the early fall, country banks drew down balances in New York to pay farmers for their crops. Speculators had to sell their stock as New York banks redeemed the loans, leading stock prices to fall, McQuarrie said.
“The banking system was very different,” he said. “It was systematic, almost annual and money always got tight in September.”
September’s losing streak is somewhat more baffling in modern times, experts said.
Investor psychology is perhaps the most significant factor, they said.
“I think there’s an element of these narratives feeding on themselves,” said Yoder of J.P Morgan. “It’s the same concept as a recession narrative begetting a recession. It gets in the psyche.”
There are likely other contributing elements, she said.
For example, mutual funds generally sell stock to lock in profits and losses for tax purposes — so-called “tax loss harvesting” — near the end of the fiscal year, typically around Oct. 31. Funds often start giving capital-gains tax estimates to investors in October.
Mutual funds seem to be “pulling forward” those tax-oriented stock sales into September more often, Yoder said.
I think there’s an element of these narratives feeding on themselves.
Abby Yoder
U.S. equity strategist at J.P Morgan Private Bank
Investor uncertainty around the outcome of the U.S. presidential election in November and next week’s Federal Reserve policy meeting, during which officials are expected to cut interest rates for the first time since the Covid-19 pandemic began, may exacerbate weakness this September, Yoder said.
“Markets don’t like uncertainty,” she said.
But ultimately, “I don’t think anybody has a good explanation for why the pattern continues, other than the psychological one,” McQuarrie said.
A Social Security Administration (SSA) office in Washington, DC, March 26, 2025.
Saul Loeb | Afp | Getty Images
A group of disability advocates filed a federal lawsuit against the Social Security Administration and the so-called Department of Government Efficiency on Wednesday aimed at stopping cuts to the agency’s services.
Recent changes at the Social Security Administration under DOGE — including staff reductions, the elimination of certain offices and new requirements to seek in-person services — have made it more difficult for individuals with disabilities and older adults to access benefits, the lawsuit argues.
The complaint was filed in the U.S. District Court for the District of Columbia.
The plaintiffs include the National Federation of the Blind, the American Association of People with Disabilities,Deaf Equality, the National Committee to Preserve Social Security and Medicare, the Massachusetts Senior Action Council and individual beneficiaries.
“The defendants’ actions are an unprecedented and unconstitutional assault on Social Security benefits, concealed beneath the hollow pretense of bureaucratic ‘reform,'” the complaint states.
In nine weeks, the new administration has “upended” the agency with “sweeping and destabilizing policy changes,” the plaintiffs claim, that have shifted agency functions to local offices while slashing telephone services.
“The result is a systematic dismantling of SSA’s core functions, leaving millions of beneficiaries without the essential benefits they are legally entitled to,” the lawsuit complaint states.
The “mass restructuring” of the agency is unlawful and violates the Rehabilitation Act and the Administrative Procedure Act, the lawsuit argues. The changes also violate multiple constitutional provisions, including the First Amendment right to petition the government for redress of grievances, according to the plaintiffs.
With 1.1 million disability claims pending, the recent actions could also be life threatening to individuals who are dying or going bankrupt while waiting for decisions, they allege.
The Social Security Administration did not respond to CNBC’s request for comment.
“President Trump has made it clear he is committed to making the federal government more efficient,” White House spokesperson Liz Huston said in an email statement. “He has the authority to manage agency restructuring and workforce reductions, and the administration’s actions are fully compliant with the law.”
Lawsuit alleges reform is ‘administrative vandalism’
People hold signs during a protest against cuts made by U.S. President Donald Trump’s administration to the Social Security Administration, in White Plains, New York, U.S., March 22, 2025.
Nathan Layne | Reuters
The Social Security Administration sends monthly checks to around 73 million Social Security and Supplemental Security Income beneficiaries.
DOGE, which is not an official government entity, has been tasked with cutting “waste, fraud and abuse” within the federal government. President Donald Trump issued an executive order creating DOGE on Jan. 20, the same day he was inaugurated.
Since then, the Social Security Administration has cut 7,000 employee positions and closed the Office of Civil Rights and Equal Opportunity and the Office of Transformation. The Office of Civil Rights and Equal Opportunity handled the agency’s equal employment opportunity and civil rights programs. The Office of Transformation was responsible for coordinating customer service-related initiatives like adding the ability to use digital signatures and electronic documents.
The Social Security Administration has also changed its identity proofing policies for claiming benefits and changing direct deposit information that is expected to require more individuals to visit the agency’s offices in person.
The agency has updated its policy, allowing individuals applying for Social Security Disability Insurance, Medicare, or Supplemental Security Income who cannot use a personal my Social Security account to complete their claim entirely over the telephone, starting April 14.
The reforms amount to the dismantling of “core functions of SSA, abandoning millions of Americans to poverty and indignity,” according to the plaintiffs’ complaint.
“What the defendants frame as ‘reform’ is, in truth, administrative vandalism,” the lawsuit states.
Beneficiaries face long waits, overpayment issues
The plaintiffs include seven individuals whose experiences, including long customer service waits and, in some cases, demands to repay large sums to the Social Security Administration, are detailed in the complaint.
One plaintiff, Treva Olivero, who has been legally blind since birth, was informed in March 2024 that she had been overpaid Social Security disability insurance benefits for five or six years, prompting the agency to demand she repay more than $100,000, according to the complaint.
Olivero’s Medicaid coverage was also terminated soon after, which left her without income and health coverage. She has since been in an “ongoing struggle” to have her disability benefits reinstated, while also facing almost $80,000 in medical debt, according to the complaint.
Another plaintiff, Merry Schoch, who received Social Security disability insurance for many years, returned to work to help pay for large medical bills after she was hit by a waste management truck in 2022. She reported her income to the Social Security Administration, and the agency made no changes to her benefit payments, according to the complaint.
Two years later, Schoch stopped working and reported her unemployment to the Social Security Administration. In August 2024, the agency then terminated her benefits and informed Schoch that she owed $30,000 for the disability benefit payments she received while working full time, according to the complaint.
Last September, Schoch was informed she could reapply for benefits. However, she has since struggled to get in touch with the agency over the phone, online and in person.
Both Olivero and Schoch are members of the National Federation of the Blind, which is also a plaintiff.
The plaintiffs want the court to reverse the Social Security Administration’s recent reforms, including staff reductions, closures of certain offices and policies requiring in-person appointments.
Consumers worry that the duties will cause inflation to flare up again, while investors fear that higher prices will mean lower profits and more pain for the battered stock market.
But sharp drops — or sudden spikes — in the market are to be expected, according to Jean Chatzky, CEO of HerMoney.com and host of the podcast HerMoney with Jean Chatzky.
“With these volatile markets, you do not want to time the market,” she said of the old adage. “Timing the market doesn’t work — it’s time in the market.”
Trade tensions, inflation and concerns about a possible recession have undermined consumer confidence across the board, several studies show.
Still, it’s normal for most Americans to feel unnerved during heightened volatility, Chatzky said.
“There’s very little doubt that consumers are feeling nervous, maybe more nervous than we’ve felt in quite some time,” she said.
Committing to setting money aside in a high-yield savings account, whether by scaling back on dining out or rideshare expenses, will help regain some financial control, Chatzky said.
“Taking action is the best way to feel more resilient,” she said.
It’s understandable why some may be hesitant to continue investing, however, when you are investing for the long term, a down market is an opportunity fordollar-cost averaging, which helps smooth out price fluctuations in the market, Chatzky said.
This is also a good time to check your investments to make sure you are still allocated properly and rebalance as needed, so you are not taking on more risk that you are comfortable with, she added.
Timing the market is a losing bet
Talk yourself down from making any sudden financial moves, Chatzky advised.
Trying to time the market is almost always a bad idea, other financial experts also say. That’s because it’s impossible to know when good and bad days will happen.
For example, the 10 best trading days by percentage gain for the S&P 500 over the past three decades all occurred during recessions, often in close proximity to the worst days, according to a Wells Fargo analysis published last year.
And, although stocks go up and down, the S&P 500 index has an average annualized return of around 10% over the past few decades.
Nearly 1 in 3 American admit that they procrastinate when it comes filing their taxes, according to a January survey of more than 1,000 U.S. filers from IPX1031, an investment property exchange service. In addition, about 25% do not feel prepared to file their taxes, the survey found.
As of March 21, the IRS received roughly 80 million individual returns of the 140 million expected this filing season, the agency’s latest reporting shows.
However, the federal tax deadline for the majority of taxpayers is April 15. It’s possible to push that due date to Oct. 15 by filing for an extension.
But “it’s an extension to file, not an extension to pay,” said Jo Anna Fellon, managing director at financial services firm CBIZ.
“It’s an extension to file, not an extension to pay.”
After the tax deadline, you will start incurring the failure-to-pay penalty of 0.5% of your unpaid taxes for each month or partial month that your taxes remain unpaid. The failure-to-pay penalty has a maximum charge of 25% of your unpaid taxes.
That’s cheaper than the failure-to-file penalty, which applies when you don’t submit your return by the deadline. The failure-to-file penalty is 5% of unpaid taxes monthly, also limited to 25%.
But you’ll also owe interest on your unpaid balance, which is currently 7% and accrues daily after April 15.
You can estimate your taxes owed by creating a “pro forma return” — or mock version of your filing — using as many tax forms as possible, Fellon said.
The ‘easiest way’ to file an extension
There are a few free options to file a tax extension.
For federal taxes, you can complete Form 4868 and mail it to the IRS. But it’s better to file digitally to avoid processing delays amid the agency’s shrinking workforce, experts say. Paper filing can also increase fraud risk, they say.
The “easiest way” is by choosing “extension” when making a payment for 2024, which automatically submits Form 4868, according to Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida.
“It takes all of five minutes,” and you can double-check the transaction via your IRS online account, he said.
IRS Direct Pay
Internal Revenue Service
Alternatively, you can file your extension for free online via IRS Free File, a public-private partnership between the IRS and several tax software companies.
For the 2025 season, you can use IRS Free File for returns if your adjusted gross income, or AGI, was $84,000 or less in 2024. But there’s no income limit to file an extension, Lucas said.