What is the difference between a market correction and a bear market?

A correction is a drop of 10% or more from a recent high, and a bear market is a drop of 20% or more. The labels are just thresholds, not predictions – they describe how far prices have fallen, not how long the decline will last. Corrections are common; on average the S&P 500 has a correction roughly once a year, and most resolve within a few months. Bear markets are rarer and tend to coincide with recessions, but historically the market has recovered every one of them and gone on to new highs. The practical takeaway: neither label tells you what to do. If your goals and time horizon haven't changed, your plan shouldn't either. Knowing these are normal, recurring events helps you avoid panic-selling at the worst moment.