Should You Put Off Retirement Amid Trump’s Mass Tariffs?
Written by
G. Brian Davis
Edited by
Jenna Klaverweiden
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With all the market volatility and policy uncertainty over the past three months, some older Americans may have considered delaying their retirement.
Should you put off retirement, in light of all the tariff uncertainty and market turmoil? Several retirement experts weigh in to help you make a confident decision either way.
Also see how President Trump’s many executive orders could impact retirees.
Retirement Portfolios Should Be Turmoil-Proof
“Retirement should never hinge on stock market performance or the latest policy decision,” said Anthony Saccaro, president of Providence Financial & Insurance Services.
Saccaro explained that there will always be something scary looming on the horizon, whether it’s a recession, inflation, geopolitical uncertainty or, yes, tariffs. Retirement planners help investors build a nest egg that won’t crack during downturns.
“We build portfolios to generate reliable income — through interest, dividends and other income-producing investments — so retirees can maintain their lifestyle no matter what the market is doing,” he said.
Protect Against Sequence Risk
Mathematically, the greatest risk for retirees comes at the very beginning.
Sean Lovison, CFP, founder of Purpose Built Financial Services, explained the concept of sequence of returns risk: “Most retirees don’t fail because of one bad year, they fail because of a few bad years right at the beginning. Our clients mitigate that by holding one to two years of expenses in cash and another few years in stable, high-quality income investments,” he said.
That can help new retirees sleep at night even if the stock market crashes the day after they retire.
Protect Against Inflation
Lovison added that inflation remains the silent killer of retirement portfolios.
“While market volatility grabs the headlines, inflation is the real risk as it quietly eats away at purchasing power. That’s why our post-retirement strategies emphasize Treasury Inflation-Protected Securities (TIPS) for short- to mid-term cash needs while still having some funds in equities for long term growth,” he said.
Specifically, Lovison recommended Treasury Inflation-Protected Securities (TIPS) for those stable income investments that can see you through the first few years of retirement in the event of a market downturn.
Emotion Management
Financial planning isn’t just a math problem — it’s an emotion and behavior problem. You could have the ideal retirement portfolio, but if you panic-sell during a market crash, you can gut your portfolio.
“Conservative investing in the years just before and after retiring doesn’t just protect against sequence risk,” explained Jonathan Thomas, CFP, a private wealth advisor at LVW Advisors. “It also eases the emotional transition from being a net saver to a net spender, living off the wealth you’ve accumulated.”
Consider a Transitional Gig
Thomas said that the fear of a market crash can take a real toll, even if your plan is sound. “If delaying retirement by a year or two would leave you better prepared — both financially and emotionally — it might be the right move,” he said.
That doesn’t mean you have to keep grinding away at your high-octane day job, however. Consider easing into retirement with fun or fulfilling work that juices your energy rather than draining it.
No one says you have to work full time, either. You can work part time as you transition to retirement, perhaps even for your current employer if you enjoy the work. Or you could switch to gig work that you do on your own schedule. Some gigs and jobs let you earn money remotely, so you can travel while still generating income.
When in doubt, speak with a financial planner. Not only can they help you structure your portfolio to survive recessions and inflation, but they can also help talk you off the ledge if you panic over the latest curveball the market throws your way.
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.
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