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With talk of trade wars, fear of stagflation and slashes to Social Security staffing, you might be justifiably concerned about your retirement savings — especially if you’re one of thousands of federal workers now without a job.
“The level of tariff increases announced so far is significantly larger than anticipated, and the same is likely to be true of the economic effects, which will include higher inflation and slower growth,” Jerome Powell, the chair of the Federal Reserve, said at the Economic Club of Chicago in April 2025.
“Both survey and market-based measures of near-term inflation expectations have moved up significantly, with survey participants pointing to tariffs.”
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Powell isn’t alone in his concern. Almost nine-in-ten (89%) of U.S. adults anticipate price increases as a result of President Donald Trump’s tariff policy, according to a new Gallup poll. What’s more, the Federal Open Market Committee (FOMC) — the policy-making wing of the Federal Reserve System — is also concerned about the short-term effects of Trump’s economic policies.
Economists are warning of stagflation
Thanks to Trump’s aggressive economic policies, there’s now fear of stagflation — simultaneous slow economic growth and elevated inflation — hitting the U.S. economy.
“The Federal Reserve’s projections confirm what millions of Americans are already thinking: President Trump is steering our economy toward disaster,” said Alex Jacquez, chief of policy and advocacy at non-profit think tank Groundwork Collaborative, in response to the latest Fed projections.
American optimism about their financial prospects fell for the fourth straight month in April, according to the University of Michigan’s Consumer Sentiment Report. Consumer expectations — gauging American attitudes towards the future — have tumbled by 32% since January, in the steepest three-month decline since the 1990 recession.
Combined, these bleak figures suggest Americans believe things won’t get better any time soon.
“Launching chaotic trade wars with our allies and gutting Social Security, Medicaid and other vital programs in order to fund tax breaks for his billionaire donors isn’t making life more affordable for working-class families,” Jacquez said.
“It is, however, a perfect recipe for stagflation.”
While other economists and industry-watchers are more guarded in their assessments, many agree that Trump’s policies could lead to a period of stagflation.
Richard Clarida — global economic advisor at Pacific Investment Management Company and former Federal Reserve vice-chairman — told Bloomberg that there’s “already at least a whiff of stagflation right now” in the U.S.
3 steps to take if you’re saving for retirement
Prepare for shocks
A clean balance sheet is one of the best steps you can take to brace for market impact.
This starts with paying down any debt, reviewing your insurance and assessing your emergency fund. In the current climate this is especially important for Federal Employees who may experience downsizing. At least 120,000 federal employees have been let go, according to an analysis conducted by CNN. Notably, this already high figure doesn’t include those on administrative leave or who accepted buyouts.
If building a nest egg sounds difficult under these conditions, Acorns is here to help to make saving and investing less daunting.
Every time you make a purchase on your credit or debit card, Acorns automatically rounds up to the nearest dollar and places the extra cash into a smart investment portfolio. This way, even the most essential spending translates to money saved for the future.
If you sign up now and you can get a $20 bonus investment.
Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it
Ramp up your savings
Once you get your feet underneath you, it’s time to start growing your wealth in earnest and ramping up your saving strategy.
A good place to start is maxing out any employer contributions to your 401(k). If you’re over 50, take advantage of top-up provisions for your retirement accounts.
Given the shaky start to 2025’s markets, it may also be worth considering inflation-resistant investments, such as gold. While the S&P 500 has had a volatile last six months, the price of gold breached $3,000 per ounce in April.
To capitalize on gold’s growth potential while also securing tax advantages, one option is opening a gold IRA with the help of Priority Gold.
Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account, thereby combining the tax advantages of an IRA with the protective benefits of investing in gold against economic uncertainties. When you make a qualifying purchase with Priority Gold, you can receive up to $10,000 in free silver.
Revisit your investments
Once you’ve established a solid foundation it’s time to start thinking long-term.
Talking to your financial advisor about how to get the most for your money is a key step to securing your golden years, a college fund for your kids or paying down a mortgage quickly.
If you don’t have a financial expert in your corner, Advisor.com can help you find a trusted fiduciary to chart a course through tough market conditions.
Advisor matches you with a vetted financial advisor that can offer personalized advice to help you make the right choices, invest wisely and secure the retirement you’ve always dreamed of. Start planning early, and get your retirement mapped out today.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
