09 Apr 2025

How will the US Tariffs affect my money?

President Trump recently announced tariffs across all trading partners. These tariffs were higher than expected, which has affected global markets. But financial markets and share prices change all the time. When their value falls that can impact the value of investments like ISAs, pension savings and drawdown.

The past few years have been particularly challenging, with Brexit, Covid, the Russia/Ukraine war and political events in the UK all sparking market volatility. When markets fall like this, it can be tempting to withdraw your money to protect it. But this might mean selling your investment at a loss. It's also important to remember that investments are long-term and designed to ride out these ups and downs. Here we look at how the US Tariffs could affect your money and what you can do to reduce the impact.

What impact will the tariffs have on my investments?

Stock markets were shaken by the announcement of the tariffs. So you'll probably have seen a drop in the value of your investments over the last few days. Stocks and shares ISAs are designed for long-term investing - at least five years - and should balance out the highs and lows. When markets fall like this, it may be tempting to withdraw money to protect it. This may cause you to sell your investment at a loss. Which may have been avoidable if you held the investment for the long term. Although, staying invested means changes in financial markets will continue to affect your investments and current values aren't guaranteed.

How will this affect the value of my pension?

A pension is a good example of a long-term investment. You’ll probably be paying into it for a few decades. Over the years you can expect to see its value go up and down in line with broader market movements. Right now, if you have a defined contribution pension, you might have seen an impact to its value.

Our Workplace Product Strategy & Proposition Manager, Michael Porter spoke about this recently on our podcast A Little Bit Richer:

"The last few years, we've seen quite a lot of market turbulence, as we would call it. So that's where investment markets have gone up and down. We've had a lot of political uncertainty. But the main thing to note is that your pension savings are a long- term investment, over 30, 40 years. You might expect to see your pension savings go down in the short term, but history shows us that over the long term, they tend to do quite well from a performance perspective. But again, not guaranteed, can still go down and you might actually get back less than you put in, but typically, they will grow."

How much tax could you pay?

If you're thinking about accessing money from your pension, it's a good idea to understand how much tax you'll pay. Use our calculator to see how much you might pay if you take it in one lump sum or over a few years.

What can I do?

Stay focused on your long-term goals.
Stability is important, and continuing to pay into your investment products is generally a good idea too.
Diversification of your investments means you're not relying on the performance of one investment.
If you’re thinking about accessing your pension savings and turning them into retirement income, it’s more important than ever to think about guidance or advice before making any decisions about drawing your tax free cash and pension savings.

Looking after your pension in times of uncertainty

It can be hard to know how to look after your pension in uncertain times, and what the best thing to do is. We look at how to take a long-term view of your investments.

Can I opt out of my pension?

Can you opt out of your pension? We help you decide whether cancelling your pension is a good decision for you.

Guidance and Advice Guide

Download our free guide to understand the difference between guidance and advice, when you need each of them and how to get the most out of them.