Tariffs on Global Goods and Your Money
In the last couple of months, there has been a great deal of uncertainty over the President’s economic plan. The present administration had announced brand new tariffs, delays in implementing them, a “Liberation Day” imposing vast tariffs on global imports to the US, and most recently a 90-day pause in their implementation. We don’t know whether these deep, global tariffs will ever be enforced, but we do know this: They (and the uncertainty surrounding them) have caused unsettlingly large losses in the financial markets.
These tariffs may be designed to be implemented for long periods. Their announcement may be used solely as a negotiating ploy. Indeed, existing tariffs may increase—but not at the levels advertised.
It’s About Financial Peace, not Stock Watching
We also know that the tariffs and their effect on the stock market do not have real implications on your immediate finances, unless you must withdraw money from your retirement account right now (for example, if you have to take a minimum required distribution from an IRA or 401K). In other words, has it affected your ability to work? To pay your bills? To afford the rising cost of eggs at the grocery?
Unless you are a day trader or someone who compulsively watches their investment portfolio performance multiple times a day, this sudden downturn in the market should not panic the average investor.
At Isakov Planning Group, our investing and savings approach has always been about the long term, a decade not a day. That means that we want to ensure our clients meet their long-term financial goals through a well-conceived strategy for wealth accumulation.
Our advice today, in the face of these economic uncertainties, really hasn’t changed from years past: Look under the hood of your investment vehicles and make sure they are built for long-term growth. That is, will they endure short-term market changes and deliver for you for years to come? If you’ve invested wisely, there is no real benefit in making rash changes in the face of an uncertain stock market.
We’ve just been there. Experienced the stock indexes falling by 5% or more in less than a week. The best thing to do is to pause…then consider your lifestyle and your budget. If you are living within your means, everything will be fine. If you are living beyond your means, well, maybe it is not a great time to go into further debt.
At Isakov Planning Group, we’re no strangers to addressing market uncertainty. If you have questions about your investment strategy and how today’s economic climate may affect them, we want to hear from you. Please contact us today to start a conversation and a free, no-obligation financial review.