Boomers: This Is What You Shouldn’t Do With Your Money Before Trump Takes Office
Written by
Kerra Bolton
Edited by
Gary Dudak
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
With President-elect Donald Trump’s second term upcoming, many baby boomers may feel compelled to make financial moves in anticipation of potential economic policy changes.
However, financial experts said boomers, especially older ones, should avoid making drastic changes to their finances right now.
Boomers, this is what you shouldn’t do with your money before Trump takes office.
Also see three changes Trump could make to retirement regulations.
Invest In Campaign Promises
Boomers should avoid making drastic changes to their investment portfolios based on economic policies Trump could make but hasn’t yet.
“We know that deregulation and tariffs are high on the list of likely policy changes, but we don’t have enough information yet to know the potential impact of these changes,” said Stuart Schiffman, CFP, ChFC, founder and managing partner at Compound Wealth Advisors. “Many investors may jump on the latest fads in the stock market because they believe the next administration will be pro-business. In actuality, portfolio allocations should be based on long-term needs that extend well beyond any policy changes that may be enacted during the next four years.”
In addition, relocating assets based on speculative outcomes could expose retirees to unnecessary risk, especially if market shifts don’t align with their expectations, according to Christopher Stroup, CFP, founder and president of Silicon Beach Financial.
“This strategy may jeopardize long-term stability, which could inadvertently increase volatility in retirement portfolios,” Stroup said.
Make Large Purchases
On the campaign trail, Trump promised to make inflation “vanish.” However, his strong stance on imposing tariffs on imports from other countries, including Mexico and China, could spark inflation, which now stands at nearly 3%.
“The major concern for retirees should be inflation,” Schiffman said. “If the prices of various goods increase due to tariffs, and retaliatory tariffs, that could become a major concern for retirees.”
Inflation typically leads to higher interest rates as central banks, like the Federal Reserve, raise rates to slow economic activity and stabilize prices.
“Boomers should approach large purchases or financial commitments cautiously before Trump takes office,” Stroup said. “Avoid[ing] new debt or refinancing, unless absolutely necessary, could help maintain financial flexibility in the face of uncertain policy changes.”
Make Impulsive Decisions
Financial experts said boomers should avoid allowing their emotions to guide investment decisions.
“Emotions are the bane of an investor,” Schiffman said. “Our animal spirits work against us when we let emotions rule our investment decisions.”
Boomers who react emotionally to market volatility or proposed economic policies by the incoming presidential administration could make impulsive decisions that put their retirement savings at risk.
“This could result in locking losses or missing long-term growth,” Stroup said. “Such actions could jeopardize retirement security, especially if you’re driven by short-term fears or uncertainty over political and economic shifts.”
Delay Social Security
Some boomers may consider delaying Social Security benefits, because their check could increase by 8% annually for every year an individual delays receiving them before the age of 70.
In addition, they may hope that Trump’s promises to continue or make permanent tax cuts enacted during his first administration and his pro-business stance will result in better investment returns, minimizing their reliance on Social Security income.
However, delaying the benefits because of speculative changes may not always produce the desired results. Social Security policy shifts often face significant legislative hurdles and may not materialize.
“While we do expect more volatility due to policy changes with the incoming administration, we just don’t have enough information yet to discern anything more than the need to stay well diversified,” Schiffman said. “Delaying Social Security benefits and withdrawing money from retirement accounts should have more to do with personal circumstances than it does expected policy changes.”
Ignore Legacy Building
No matter who is in the White House, boomers should consider their legacy when making financial and professional decisions.
“Younger boomers, who are still working or running businesses, are delaying the transfer of industries and skills to the next generation,” said Kelly Ann Winget, founder and CEO of Alternative Wealth Partners. “This has long-term effects they may not see — or seem to worry about — in their lifetime.”
Winget said boomers who are already in retirement should focus on managing their spending and staying financially conscious.
“Those still in the workforce should prioritize planning for their next phase — whether that’s retirement, succession or legacy building, and think seriously about how they’ll leave opportunities for the next generation,” she said.
Editor’s note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
More From GOBankingRates
