✪ Financial Turmoil: Steps to Take Now

In March and April 2025, financial markets experienced significant turmoil, primarily due to the implementation of aggressive tariff policies by the current administration.

On April 2, 2025, Donald Trump announced sweeping tariffs on nearly all imports, including a 10% baseline tariff on all imports, with higher rates for specific countries such as a 54% tariff on Chinese goods. This action led to immediate and severe market reactions:

These actions caused the S&P 500 to drop 10% over two days, marking one of the larger declines in recent history.

Global Retaliation: China responded with an 84% tariff on U.S. imports, and the European Union imposed counter-tariffs on American products, escalating trade tensions.
Investor Sentiment: The uncertainty surrounding these trade policies led to increased market volatility and fears of a potential recession.

Then today (April 9, 2025) the S&P 500 shot up 9.5%. The biggest gain since 2008.¹

No one really knows where the economy (or markets) are headed in the short term. Regardless of what you watch on the news.

In light of this financial instability, you may have several concerns regarding your investments and financial future. Addressing these concerns can help provide perspective and guide decision-making during uncertain times.

Here are Some Common Questions and Considerations:

Isn't this downturn different from past downturns?

While the specific causes of market downturns vary, market volatility and economic cycles are inherent aspects of investing. Historically, markets have demonstrated resilience and the ability to recover over time. (Past performance is not indicative of future results)

If my retirement accounts have significantly decreased and I'm ready to take money out, won't I run out of money?

Withdrawing from retirement accounts during a market downturn can impact the longevity of your savings. It's advisable to assess your withdrawal strategy, consider reducing discretionary spending, and consult with a Certified Financial Planner® practitioner to explore options that can help ensure you are on track. (See the conclusion section)

Should I move my investments to cash?

Shifting to more conservative investments like cash can reduce exposure to market volatility but may also limit potential for growth. A balanced approach, aligned with your financial objectives and risk tolerance, is essential. Remember, making financial decisions in a state of fear can lead to costly mistakes.

How can I protect my investments from future market volatility?

Diversification across asset classes and geographies, regular portfolio reviews, and staying informed about economic developments can help manage and mitigate risks associated with market fluctuations.

Addressing these questions can help you gain perspective and make informed decisions during periods of financial uncertainty.

Revisit Your Financial Plan (and if you don’t have one, I recommend this as a first step)

Review your overall financial goals, time horizons, and risk tolerance.
Make sure your current investments still align with your long-term objectives.

Don’t Panic

Knee-jerk reactions to downturns often lead to locking in losses. Over the last 30 odd years I’ve been helping people with their finances. During the bad times, I’ve seen more than my share of people that came to me after they sold everything and were going to wait until “Things got better” to put their money back in. This is called market timing, and it just doesn’t work.

Remember: downturns are part of the investment cycle, and historically, markets have always recovered—though the timing varies. (Past performance is not indicative of future results)

Being worried or anxious is normal and you shouldn’t negate those feelings. But letting fear drive a financial decision can lead to costly mistakes.

Build or Replenish Your Emergency Fund

Aim for 3–6 months of living expenses in a high-yield savings account.
This gives you breathing room and avoids tapping long-term investments (which aren’t meant for emergencies) during market dips.

Diversify Your Portfolio

Make sure your investments span multiple asset classes (stocks, bonds, cash equivalents) and geographic regions.
Diversification helps spread risk and reduce overall volatility.

Rebalance if Necessary

Market drops may have skewed your allocation. For example, you may now be overexposed to equities.
Rebalancing helps maintain your intended level of risk.

Delay Big Financial Decisions (if possible)

If you're close to retirement, consider delaying large withdrawals or reducing discretionary expenses until markets stabilize.
Work with your planner to explore bucket strategies (cash, bonds, equities) to minimize sequence of return risk.

Stay Informed, But Don’t Obsess

Following daily headlines can increase stress without improving outcomes.
Check in periodically and lean on trusted sources—not sensationalist media.

Speak With a Certified Financial Planner® practitioner

A calm, experienced advisor can offer perspective, help assess your personal situation and identify tax-efficient strategies (like tax-loss harvesting or Roth conversions).

Conclusion

No one likes to see the value of their investments go down. Even if the decline is temporary. One thing to keep in mind is, even if one is near retirement and they see their retirement accounts go down in value, very rarely is one taking 100% of their money out at once.

If you are subject to Required Minimum Distributions (RMD’s), you need to take a percentage out each year. This varies by age however it could be between 4% and 6%. This allows the rest of your account to remain in your account.

Here is an example. Let’s say you are 75 years old, and you have $700,000 in your IRA. Your RMD would be approximately $28,000 that year. That comes to about a 4% withdrawal.

Let’s say the following year when you are 76, your account value has dropped to $650,000. Your RMD at 76 would be about $27,000.

These are trying times indeed. I’m here to help.

¹The Standard and Poor's 500 is an unmanaged index of large, publicly-traded companies in the U.S.

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All the best.

Rick Fingerman, CFP®, CDFA™, CCPS®

617-630-4978

Rick@PlanWithFPS.com

Financial Planning Solutions, LLC (FPS) provides this blog for informational and educational purposes only. Nothing in this blog should be considered investment, tax, medical, or legal advice. FPS only renders personalized advice to each client. Information herein includes opinions and source information that is believed to be reliable. However, such information may not be independently verified by FPS