Advertisement
Politics

Keep Calm and Carry On as Markets Adjust to Trump Presidency

If you’re worried about all the political and economic changes ahead, you’re not alone, but there are some reasons to take comfort, too.

Well, this is different. A real estate mogul and reality TV star has become the 45th president of the United States. He isn’t a politician, he’s never held office, and it’s unclear what he’ll prioritize. And that’s something we aren’t used to.

We know Donald Trump, of course. What we don’t know is how he’ll transition from billionaire businessman to commander in chief.

Advertisement - Article continues below

Investors are, naturally, a little nervous about that, given the uncertainty about what Trump’s policies will be, and how they’ll affect the stock market. Wall Street doesn’t like uncertainty, at least not historically.

But the dire downturn everyone expected right after the election didn’t happen; the markets dipped for a minute, and then actually climbed higher.

Who knows what will happen next? There still could be some volatility as the new administration gets down to work — some ups and downs as we all try to figure things out. Or it could be that issues already in play — inflation, interest rates, unemployment — will be what really influence the market’s mood.

Either way, investors should stay the course.

Advisers are always telling their clients (and potential clients) that they need a plan. What’s just as important in times like these is to stick to that plan. Yes, we’ll need some flexibility to tweak things if necessary. But one of the worst things you could do is let your emotions take over and cause you to change your saving and investing strategies. In my experience, that’s pretty much a guaranteed way to lose money — particularly if you are near or in retirement.

Advertisement - Article continues below
Advertisement
Advertisement - Article continues below

If you’re a worrier looking for positives, there are plenty. During the campaign, Trump talked about lowering taxes for both corporations and small businesses, which could improve their earnings potential. And he has proposed other changes, most notably eliminating the estate tax, which would benefit a number of wealthy individual taxpayers.

Trump also will likely decrease regulation on some businesses, including energy, banking and biotechnology, which should stimulate those industries and energize the economy. The same goes for his plans to devote money to modernizing the nation’s aging infrastructure.

And actions that already were underway — raising interest rates, changing the fiduciary rule — should proceed in some form that also can be a plus for investors in the long run.

If you aren’t a Trump fan, you can take comfort in knowing that any policies that come from his administration probably will take at least six months to a year to implement. So, we’ll have plenty of time to react to changes without making any knee-jerk mistakes.

Advertisement - Article continues below

And if you like to look at statistical data, while not necessarily indicative of the future, there’s evidence that with time, the market goes north, no matter which party is in office.

The important thing — and this can’t be stated too strongly or too often — is not to panic. If your portfolio is diversified and you and your adviser have done a good job of determining your objectives, mapping out your retirement time frame and investing according to your risk tolerance, you can be confident you’re on the right path.

If you have questions or concerns, however, never hesitate to call your financial professional and set up a meeting.

Steve Fullerton is co-founder of Fullerton Financial Planning and is FINRA licensed with Series 7, 63 and 66, as well as health and life. He is the founder and president of Kingdom Financial Group LLC, a Registered Investment Advisor with the SEC.

Kim Franke-Folstad contributed to this article.

Advertisement

About the Author

Steve Fullerton, Investment Adviser

Co-Founder, Fullerton Financial Planning

Steve Fullerton is co-founder of Fullerton Financial Planning and is FINRA licensed with Series 7, 63 and 66, as well as health and life. He is the founder and president of Kingdom Financial Group LLC, a Registered Investment Adviser with the SEC.

Advertisement

Most Popular

Medicare Basics: 11 Things You Need to Know
Medicare

Medicare Basics: 11 Things You Need to Know

There's Medicare Part A, Part B, Part D, medigap plans, Medicare Advantage plans and so on. We sort out the confusion about signing up for Medicare --…
September 16, 2020
5 Unfortunate Estate Planning Myths You Probably Believe
estate planning

5 Unfortunate Estate Planning Myths You Probably Believe

These all-too-common misconceptions can steer your estate plans in the wrong direction right from the start. Here’s how to overcome them and tips to b…
September 17, 2020
Election 2020: Joe Biden's Tax Plans
taxes

Election 2020: Joe Biden's Tax Plans

With the economy in trouble, tax policy takes on added importance in the 2020 presidential election. So, let's take a look at what Joe Biden has said …
September 18, 2020

Recommended

Retirees, Create An Emergency Fund for Rental Property
Business Costs & Regulation

Retirees, Create An Emergency Fund for Rental Property

Build a cushion to protect your income from an unforeseen crisis.
September 15, 2020
25 Small Towns With Big Millionaire Populations
investing

25 Small Towns With Big Millionaire Populations

Large concentrations of high-net-worth households are found in surprising locales across the U.S. Check out the latest list of American small towns te…
September 15, 2020
Bankruptcy Filings Chalked Up to COVID-19
investing

Bankruptcy Filings Chalked Up to COVID-19

Bankruptcy filings pile ever higher as the COVID-19 pandemic continues to weigh on the American economy. Here are 24 big-name companies that have soug…
September 11, 2020
What Does the Upcoming Election Mean to Your Investments?
investing

What Does the Upcoming Election Mean to Your Investments?

For smart investors, the surprising answer may be very little. Here’s why, and what you should do (and not do) as election season heats up.
September 11, 2020