Concerned about tariff impacts on your 401(k)? Philadelphia-based financial adviser has these tips
Americans are watching their wallets to see what happens with President Trump's newly-instituted tariffs and relation from U.S. trading partners. A 25% tariff has been imposed on all goods imported from Canada and Mexico. Trump imposed an additional 10% tariff on Chinese goods, bringing that country's rate to 20%.
Experts say how much it hurts and when consumers feel the impact depends on how long the tariffs last, and the production cycle of the product.
Wall Street is also reacting to the news. Stocks racked up more losses Tuesday, with the Dow, Nasdaq and S&P 500 all down at closing. Some are also wondering how the tariffs could impact their portfolios and 401(k).
Philadelphia-based financial adviser Rob Wilson said, tariffs or not, the markets will always fluctuate. He recommends not making any sudden moves.
"Stay the course," Wilson said. "But definitely open up your statements, or go online and take a look at your account and make sure you understand exactly what you own."
Wilson says to talk with your financial adviser to ensure you have a well-diversified portfolio across stocks, bonds, mutual funds and other investments to better weather uncertainty.
Adjustments should also depend largely on how soon you plan to retire. Someone nearing retirement in the next few years might want to consider moving more of their portfolio into less risky investments like bonds, Wilson said.
Those who are still a ways off from retirement have more room to weather the volatility in stocks, he said.
"Listen, this is money you've worked very hard for and that you want to be there for you when it's time for you to draw upon it to make sure you're allocating it in a way that makes you comfortable," Wilson said.
Focusing on what you can control is also a smart move, according to Sarah Li-Cain, an accredited financial counselor. She recommends watching your budget, minimizing your debt, and if you're able to, maximizing your 401(k) contribution to take full advantage of your employer match.
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