How to Protect Your Retirement Savings -- Even if Trump's Tariffs Threaten to Drain Them

Dana George, The Motley Fool

Tue, Apr 29, 2025, 1:57 AM 7 min read

A recent survey commissioned by the financial services company Beyond Finance asked 2,000 Americans how they feel about their finances. Only 13% said they feel "very good," while another 28% reported feeling "somewhat good." That leaves 59% feeling not so great.

That sentiment isn't surprising, given the financial uncertainties created by President Donald Trump's on-again, off-again tariffs. It's difficult (even for the experts) to know what to expect next -- and the stock market certainly does not like uncertainty.

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Whether you're just starting out in your career and your retirement savings are modest or you've been financially prepared for retirement for years, history has taught investors ways to protect their nest egg (regardless of its size). Here are three suggestions on how to navigate the recent financial turbulence.

If you're not yet retired, experts suggest saving enough in an emergency fund to cover three to six months' worth of bills. For example, if your monthly bills total $3,000, aim for $9,000 to $18,000 in easily accessible savings (in a high-yield savings account or short-term CD) to cover you if you experience a job loss, an unexpected medical event, or other "surprise" expense. If saving enough to cover your bills for three to six months seems achievable, you may want to consider saving even more. Once you've met the six-month goal, aim for nine months.

If you're retired, you know how much an unpredictable market can rain on your parade. As storm clouds approach, there's nothing better than having cash set aside for living expenses. Not only does cash provide an emotional cushion, but having enough put away to replace two years' worth of investment withdrawals also means not having to dip into your retirement funds to pay everyday expenses.

Imagine you're retired and receive a pension or Social Security benefits. You also draw $3,000 per month from a retirement account to cover the rest of your bills and give you spending money.

A good goal would be to have $72,000 in an interest-bearing savings account or in multiple staggered short-term CD accounts that you can easily access as needed ($3,000 x 24 months = $72,000). A cash reserve allows you to leave money in your retirement account when values are low.

While a dropping stock market can feel scary, it's when values are low that the best investments can be picked up at a bargain price. Then, as the market recovers, your portfolio is in a position to come back stronger than ever.