I’m a Swing State Voter: 4 Reasons I Believe Trump Will Be Better for My Retirement Savings
Written by
Marc Guberti
Edited by
Zuri Anderson
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Voters are casting their ballots right now and consider several issues before making their final decision on Election Day, including retirement savings.
High inflation and elevated interest rates have presented challenges in recent years for people who have been living on their retirement funds. Both candidates want to address this issue, but some people believe Donald Trump is more likely to deliver results if he returns to the White House.
GOBankingRates spoke with three voters who believe that a Trump presidency can bolster people’s retirement savings.
A retirement planner also revealed five money moves you should make if you think the former president will be re-elected this week.
Domestic Energy Policies Can Increase Savings
Tim Blessing, Ph.D., a history and political science professor at Alvernia University in Reading, Pennsylvania, also touched upon the impact of Trump’s domestic energy policies.
“Gas prices and the prices of items associated with petroleum should drop,” Blessing said. “Certainly, this helps with paying the mortgage and, oddly enough, with house prices since house construction uses a lot of petroleum products.
“So, the problems solved will be gas prices and the prices of goods associated with petroleum — i.e., synthetics, plastics, fertilizer, and such.”
Harris Policies Would Increase Taxes
David R., an apologetics trainer in Harleysville, Pennsylvania, is concerned about how Harris’ proposed unrealized capital gains tax.
“Her proposal to tax unrealized asset value gains is nothing but confiscation of value from hard earned savings and wealth creation,” he said. “Further, it is a demand for liquid cash from an illiquid asset. Such a proposal could cause people to be forced to sell such assets against their better judgment to raise funds to pay the tax bill.”
Inflation Affects Ability To Save for Retirement
Another voter, who wished to identify herself as Waldon Von, who works as a client services manager in northwestern Wisconsin. She said she saw her savings and income drop sharply during the Biden-Harris administration.
“I had $20,000 in the bank and the company I work for had just completed the best year ever in sales,” Von said. “Since then, with Biden [and] Harris in office; savings $0. Income less than half than 2020.”
Inflation reached a 40-year high in 2022, which didn’t sit well for most Americans. The cost of goods and services whittled down many people’s savings accounts, or impacted their ability to put away funds for retirement.
Tariffs: Short-Term Pain for Long-Term Gain
Trump has often touted how he will use tariffs to collect revenue instead of relying on income taxes.
Blessing explained how the tariffs are likely to cause short-term pain on retirement savings, followed by significant long-term benefits. He laid out the three phases of Trump’s proposed tariffs.
“At first, prices will spike as the tariffs take hold and some items become less available,” said Blessing. “American businesses will find it hard to find certain supplies, so there will likely be a spike in unemployment and business valuation will either fall slightly or flatten. There will also be a drop in exports as nations retaliate.”
He continued, “In the second phase, the economy will start to adapt. We know that labor shortages caused by the removal of [people living in the U.S. illegally] almost always see a short-term drop in the Labor Force Participation Rate. The LFPR usually quickly recovers as low-income Americans see wages rise to the point where they take the jobs.
“Meanwhile, jobs which American firms had ‘off-shored’ will be recreated here. So, after some labor and supply problems, employment will begin to rise and the Labor Force Participation Rate will improve (in fact, this was occurring in the months before the [coronavirus] lockdown).
“Price rises will taper off, probably quickly. The situation will stabilize and, for most Americans, wages will rise as the economy shifts from off-shoring to home-based industries.”
As for the third phase, Blessing said, “trading partners lower tariffs so that the Trump administration will do the same. Prices stabilize and, in a few sectors (mostly petroleum-based sectors) prices will fall. Export industries will begin to improve more quickly in the third phase. The Labor Force Participation Rate becomes steady and might even continue to rise slowly over time (again, this was occurring right before the [coronavirus] lockdown).”
What’s the bottom line for voters? Blessing summarized his predictions:
“So, at first, retirement incomes and savings will take a hit. They will then spike up and finally move into a phase of steady growth above their present levels as U.S. businesses grow in valuation,” he said.
“Overall, the movement upward in valuations, over four years’ time, should continue steadily after what will probably be a tough year.”
Editor’s note on election coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. For more coverage on this topic, please check out I’m a Swing State Voter: 6 Reasons I Believe Harris Would Be Better for My Retirement Savings.
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