A raging stock market has investors more satisfied with their finances than they have been in decades.
Financial satisfaction hit a 24-year high in the third quarter, thanks to a booming stock market and a big pool of open job opportunities, according to an index compiled by the American Institute of CPAs.
The index tracks data such as large-cap stock movement, personal taxation rates and the expectations of corporate executives and CPAs. It's calculated by measuring the difference between financial "pain" indicators and financial "pleasure" indicators.
Financial satisfaction has risen steadily upward since the financial crisis that began in 2007.
This is the third consecutive quarter that the pleasure indicators hit a record, American Institute of CPAs said. The primary contributor to the boost is the stock market, measured by a proprietary large-cap stock index. That index is composed of the 750 largest companies trading in the United States, excluding American depository receipts, mutual funds and exchange-traded funds.
AICPA's real estate index made the largest gain this quarter, thanks to gains in the market value of real estate that exceeded increases in outstanding payments on mortgages.
Home sales were unexpectedly high on Oct. 25, suggesting that the strong real estate market is continuing, though those numbers were not included in AICPA's index, which only measured data from the third quarter.
AICPA members urged caution despite the record ratings.
It is still important to have financial safeguards in case there's a pullback, according to Mark Astrinos, a CPA and certified financial planner who is founder and principal of Libra Wealth and also a member of AICPA's personal financial planning credential committee.
"As the stock market drives American's financial satisfaction to new all-time highs, many are beginning to question whether this trend is sustainable," said Robert Westley, another CPA and member of the credential committee and second vice president and financial planner at The Northern Trust Co.
The organization said there are a number of reasons to believe the recent gains in its index may not persist in the fourth quarter. Specifically, AICPA said the recent deluge of natural disasters that struck the United States, including wild fires and hurricanes, could take a toll in future quarters.
"What you're seeing is a significant divergence about how people feel generally about conditions today, which they feel are pretty good, and a growing pessimism about the economy ahead."
The strong sentiments from the third quarter strongly diverge from thoughts about the future, according to Peter Atwater, an investor sentiment expert , president of advisory firm Financial Insyghts and author of Moods and Markets.
"What you're seeing is a significant divergence about how people feel generally about conditions today, which they feel are pretty good, and a growing pessimism about the economy ahead," Atwater said. He was not involved in the AICPA survey.
Astrinos of Libra Wealth said that there were a number of precautions investors could take to stave off the worst effects of a pullback, including rebalancing investment portfolios and maintaining cash reserves for when the economy struggles.
In recent years Americans, as a whole, have started to save more money, although almost 40 percent of them have no savings at all, according to a 2017 GOBankingRates survey.
Other surveys also suggest Americans are feeling more satisfied with their financial prospects. A 2017 survey from Gallup showed that Americans were less stressed about retirement and medical costs than they had been in previous years.
Unemployment has fallen to near-record lows in recent months. In September the unemployment rate fell to 4.2 percent, the lowest since February 2001. Wage growth has not accelerated as quickly as economists expected, however.
— By Tucker Higgins, special to CNBC.com