Upticks: Tariffs…What They Could Mean for Your Retirement
By Luke Sullivan on April 10, 2025
Tariffs have seemingly taken over every headline imaginable. Let’s take a step forward and try to understand the bigger picture of our emotional connection with money and what all of these headlines could mean for your retirement future. What can we control and what can we not control? What can history tell us? How are financial advisors feeling right now? Does this compare to previous market crises? Jake and Cory have a deep conversation about our relationship with money.
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Read an overview of the conversation below:
Tariffs and Their Relevance to Retirement
Tariffs are taxes imposed on imported goods and services. They can impact the economy, affecting everything from consumer prices to investment portfolios. Jake introduces the topic by saying, “Our topic is tariffs in your retirement. Very timely.” This highlights the relevance of tariffs in the current economic climate and their potential impact on retirement planning.
Jake and Cory discuss the broader economic and political landscape, emphasizing the uncertainty tariffs can bring. Cory notes, “I think the market is not necessarily collapsing, Jake. I think that our relationship with money is collapsing and our relationship with institutions and with trust and what money represents.” This perspective highlights the importance of understanding the deeper connections between financial stability and personal well-being.
Jake adds, “It’s all about understanding why money is important to you and what you’re really looking to accomplish.” This sentiment is echoed throughout their discussion, emphasizing the need for a holistic approach to financial planning that considers both practical and emotional factors.
Jake also discusses the importance of having a diversified financial plan. He mentions, “With our clients, we like to have at least five to ten years of money not in the stock market.” This approach helps mitigate the risks associated with market volatility and helps support a stable financial foundation.
Managing Financial Uncertainty
Jake offers practical guidance for managing retirement funds during uncertain times. He suggests revisiting financial plans, continuing to save, and cutting spending. He emphasizes, “If you’re worried about running out of money and you’re worried about your retirement, then the best thing you can do is control your spending.” This guidance is particularly relevant for those feeling anxious about their financial future.
Jake outlines three tactical strategies for financial planning in the face of market volatility:
- Roth Conversion: A Roth conversion involves transferring funds from a traditional IRA to a Roth IRA. This strategy can be particularly beneficial during market downturns when the value of investments may be lower. By converting to a Roth IRA, you pay taxes on the converted amount now, but future withdrawals are tax-free. This can be advantageous if you expect to be in a higher tax bracket during retirement. Additionally, Roth IRAs do not have required minimum distributions (RMDs), allowing your investments to grow tax-free for a longer period.1
- Tax Loss Harvesting: Tax loss harvesting is a strategy used to help offset taxable gains by selling investments that have declined in value. By realizing these losses, you can reduce your taxable income and potentially lower your tax bill. The proceeds from the sale can then be reinvested in similar assets, maintaining your portfolio’s overall strategy. This approach can be particularly useful during periods of market volatility, as it allows you to take advantage of temporary declines in asset values to may improve your tax situation.2
- Investing Cash: If you have cash that you don’t need for at least five years, you can consider adding to your equity positions during market downturns. Investing in stocks when prices are lower can provide growth potential as the market recovers. This strategy requires a long-term perspective and the ability to withstand short-term volatility. By investing cash in equities, you may potentially benefit from market rebounds.3
1, 2, 3: Source: Investopedia | As of: 4/10/2025
The Role of Financial Advisors
Jake and Cory highlight the role of financial advisors in guiding clients through challenging times. Jake mentions, “We’ve got four planners on staff at Falcon Wealth Advisors. All you have to do is call them. All you have to do is email them and they’ll set a meeting with you.” This underscores the importance of seeking professional advice and leveraging the knowledge of financial planners during times of uncertainty.
Towards the end of the podcast, Jake shares a story about a listener from Montana who has successfully built a strong real estate portfolio. He says, “He started with a credit card to buy his first property and kept building it and rolling it.” This story illustrates that there are multiple paths to retirement planning. Not every path will work the same way for everyone.
Reflecting on Personal Experiences and Broader Implications
Jake and Cory delve deeper into the broader implications of financial uncertainty. Cory shares his thoughts on the cultural and spiritual aspects of financial security, stating, “I have lost myself, Jake, in 15 years, thinking that more money would be more security, our business would be bigger, and that’s going to be what helps protect everybody and protects myself.” This realization underscores the importance of finding balance and understanding the true value of money beyond its financial implications.
Thank you for tuning in, we hope you have a great week!
