Tariffs and other economic policies can have a big impact on your finances, especially as you get closer to or settle into retirement. U.S. President-elect Donald Trump’s recent talk about putting tariffs on goods from Canada, Mexico, and China has stirred up plenty of debate. Whether these tariffs actually happen or not, it’s a good reminder that global events can shake up the economy and your retirement plans.
Why Should Retirees Care About Tariffs?
Tariffs are basically taxes on goods crossing borders, often used as a trade policy tool. A proposed 25% tariff on Canadian exports to the U.S. could bring some big challenges for Canadian businesses and families. Businesses might have to absorb the extra cost, cut back in areas like labour, or pass it on to consumers through higher prices for goods and services.
Impacts on Retirees:
Tariffs don’t just hit businesses they can directly affect retirees too. Here are a few ways:
- Investment Portfolio Losses: Businesses absorbing tariff costs may generate lower profits, leading to reduced shareholder dividends.
- Higher Costs of Living: Tariffs often lead to higher prices on everyday goods, which can stretch household budgets.
- Currency Fluctuations: A weaker Canadian dollar can reduce purchasing power, particularly for those traveling or buying goods priced in U.S. dollars. Just the discussion of tariffs by Donald Trump affected financial markets and exchange rates.
You Have to Plan for the Future in a Changing Economy
Changes like tariffs are a good reminder that unexpected events can happen, especially when it comes to your retirement. While you can’t control everything, having a solid financial strategy can help protect your lifestyle and give you peace of mind. Working with someone to build a plan that fits your goals and accounts for potential risks can make all the difference in making sure your wealth lasts. That’s key for staying confident and secure in the long run.
If you’d like to learn more then join us for one of our in-person seminars or contact us today.
