Should You Wait to Invest in VOO? What Analyst Price Targets Actually Tell You

Every year, major investment banks publish year-end price targets for the S&P 500 — and every year, some investors hold off buying VOO until the market either hits those targets or pulls back to a level they consider safer. Here's why that's a riskier bet than it looks, with the real math behind what waiting actually costs.

The quick answer

Waiting to invest until the market reaches a specific price, or waiting for a dip before buying, requires correctly predicting short-term price movements — something even professional forecasters at major banks routinely disagree with each other about for the same year. There's no reliable signal that tells you "now is the right time." The cost of waiting isn't hypothetical either: every month you delay is a month of contributions that lose all the compounding time they would have had.

What analyst price targets actually are

Major banks and research firms regularly publish year-end S&P 500 price targets — essentially an informed estimate of where the index might end the year, based on earnings expectations, interest rate assumptions, and other models. These targets get wide media coverage because they're genuinely useful as one input into understanding market sentiment. What they are not is a guarantee, or even a consensus — they're one firm's model-based estimate, built on assumptions that can and do turn out wrong.

The targets don't even agree with each other

If price targets were reliable enough to plan an entry point around, you'd expect different firms to land on roughly the same number. In practice, targets for the same calendar year routinely span a wide range between firms — some meaningfully more bullish than others, based on different assumptions about rate cuts, earnings growth, and valuations. If the people whose full-time job is forecasting the market can't agree with each other, that's a strong signal that waiting for "the right price" is waiting for a number nobody can actually tell you in advance.

What waiting actually costs

Say you plan to invest $500 every month for 20 years, assuming a 7% annual return compounded monthly, with no initial lump sum. If you start now, that's $120,000 contributed over 240 months. If you instead wait a year — for a dip, a target, or just hesitation — you end up contributing for only 19 years, $114,000 total.

Starting now projects to $260,463. Waiting a year projects to $237,125. That's a $23,338 difference — more than 17 times the $6,000 difference in contributions alone — purely from losing a year of compounding time. This is a projection based on the 7% assumption, not a guarantee of VOO's actual future return; the same mechanic applies regardless of which specific return turns out to be correct. Try your own contribution amount and timeline in the VOO calculator.

There's a related pattern worth noting: even comparing a lump sum invested immediately against the same total money spread out gradually tends to favor investing sooner, not later. In one hypothetical scenario modeled in the VOO investing experiment, $36,000 invested as a lump sum immediately grew to roughly $72,348 over 10 years at a 7% assumed return, versus roughly $51,925 for the identical $36,000 spread evenly as $300 a month over the same period — because the lump sum had the full period to compound, while each later contribution only compounds for the time remaining after it goes in. Waiting for a better entry point pushes your money even further out than either of those scenarios, compounding for less time still.

What to do instead

Dollar-cost averaging — investing a fixed amount on a regular schedule regardless of price — removes the timing decision entirely. You're not betting on being right about a dip or a target; you're simply staying invested on a consistent schedule. It doesn't guarantee a better outcome than a lucky, perfectly-timed lump sum would have produced, but it avoids the far more common failure mode: waiting indefinitely for a clear signal that never actually arrives, while the compounding clock keeps not running. For the concept explained in more depth, see what dollar-cost averaging is. To model a consistent monthly schedule specifically, use the DCA calculator. None of this is personalized financial advice — consider your own goals, time horizon, and risk tolerance, and speak with a licensed professional about your specific situation.