Make Lemonade from Lemons
DEAR TRUST OFFICER:
I’ve lost a large portion of my savings in a short time, because of the uncertainty about the new tariffs. Is there something I should be doing now? —WORRIED
DEAR WORRIED:
It’s important to not let your emotions play a major role in your investment decisions. In general, you want to have an asset allocation plan in place to help smooth portfolio volatility, so you are not tempted to rush your decisions.
But it sounds like this advice is coming too late, as you already have paper losses that concern you. No one can be certain how the new tariffs will affect the economy and the financial markets.
If you have a traditional IRA, this might be a good time to consider converting it to a Roth IRA. Ordinary income taxes will be due on the amount converted, but if the values are lower the taxes will be as well. Once the conversion is made, you will have potentially tax-free retirement income. What’s more, there are no Required Minimum Distributions from Roth IRAs at age 73, as there are from traditional IRAs and qualified employer retirement plans. You will be making some lemonade from the recent sour markets.
Looking ahead, you may want to consult a professional investment manager, such as us, about structuring your portfolio to meet a variety of market conditions as the future unfolds. The worst outcome would be selling at market lows and staying in cash as prices recover, missing out on potential gains.
Do you have a question concerning wealth management or trusts? Send your inquiry to contact us.
© 2025 M.A. Co. All rights reserved.