Navigating Retirement Funds in a Tariff War

What can I do with my retirement account to better prepare for these tariffs?

A few days ago, my psychology teacher told me to write a blog about what to do with retirement funds after President Trump issued all his new tariffs. This whole economic fiasco is starting to worry Americans and many are getting more nervous about what the stock market holds in the future.

Let’s first define what exactly a retirement fund is. As it states in the name, it is essentially an account designed to help individuals save and invest for their retirement years. The most common retirement fund is the 401(k), with over 50% of the American population having access to this account. The 401(k) plan is directly connected to the stock market, as the plan includes specific stocks and ETFs (Exchanged Traded Funds), along with other assets.

So what should we do with our retirement accounts now that our country is in a tariff war? I personally recommend a few things.

1. Stay the Course

   • The stock market has a tendency to bounce back. There can be short term uncertainty, but in the long run, your investment should come back up and hopefully continue to make you money. An important factor while investing is to avoid emotional decision making. Don’t buy or sell based on emotion. Instead use facts and statistics to back up your decision. When there is a financial crisis, people tend to let their emotions get ahead of them, so make sure you aren’t one of them!

2. Diversify

   • Let’s say you're not satisfied with keeping put. Then one way to reassure yourself is to start diversifying your assets. Look into different industries and different types of assets. Not everything will be largely affected by these tariffs, so you have a chance of some asset performing well during these times. Maybe even go outside of the U.S. stock market, and consider international funds if you don’t want to be involved here.

3. Take Advantage of the Dips

   • As we have seen, the market has tanked because of these tariffs. Yes, this definitely causes uncertainty amongst the U.S. population, but this could also be a good time to buy new stocks. When investors see high performing stocks dropping, they will eventually put their money back into the market, hoping to buy shares at a lower price.

Maybe you don’t want to do anything with investing. You can carry cash instead. I personally think there should be a balance between long term investing and liquid assets, but at the end of the day, the value of your cash won’t fluctuate wildly.