How Retirees Can Save Money and Protect Their Pensions From Trump’s Tariffs

The first weeks of April were an unwelcome and unsettling financial roller coaster ride for retirees heavily invested in stocks.

President Donald Trump has since retracted some of the “Liberation Day” tariffs that triggered the ongoing stock market melee, but there’s widespread worry that those very policy inconsistencies could trigger more turmoil in the coming weeks and months.

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If the losses are steep enough, retirees or those approaching retirement might not have enough time to see their holdings ever recover. Here’s how they can prepare now by readying their portfolios for what could be troubled waters ahead.

According to Barron’s, most retirees should maintain a cash cushion of one to two years’ worth of withdrawals. The amount, which varies by retiree, is enough to cover basic expenses after factoring in Social Security benefits and other income.

This cash buffer is crucial, because it allows retirees to endure even intense periods of volatility without selling stocks at a loss. Bear markets are defined as periods where the market declines by at least 20%. Historically, they last only between nine and 10 months before the market rebounds and heads back toward bull territory. That makes 12 to 24 months of cash savings more than enough to get by without selling in the red.

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If you don’t have liquid savings, don’t do anything rash — panic selling during downturns is almost always a losing bet.

Emotional investors who sold out of fear during the fast and terrifying wipeouts that followed Trump’s tariff announcements missed the best day in market history. When the president retracted most of his yet-unimplemented import duties, the S&P 500 tallied a record single-day gain of 474 points when U.S. stocks piled on an unprecedented $5.1 trillion in market value in one trading session.

These surges — which occur periodically during every bear market — offer an opportunity to cut your losses or even harvest some gains, even if the next surge isn’t so dramatic.

Young people can keep piling onto their Nasdaq ETFs because they have the years needed to recover from the disproportionately high losses they incur when the market sours — but if they were smart, they’d choose target-based funds that ween them off that risk automatically over time.